Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. NEW YORK ( TheStreet) -- Costamare (NYSE: CMRE) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.
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- CMRE's revenue growth has slightly outpaced the industry average of 10.7%. Since the same quarter one year prior, revenues rose by 16.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Powered by its strong earnings growth of 50.00% and other important driving factors, this stock has surged by 36.25% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- COSTAMARE INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, COSTAMARE INC reported lower earnings of $1.20 versus $1.45 in the prior year. This year, the market expects an improvement in earnings ($1.42 versus $1.20).
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Marine industry and the overall market, COSTAMARE INC's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
- The debt-to-equity ratio is very high at 2.84 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. To add to this, CMRE has a quick ratio of 0.52, this demonstrates the lack of ability of the company to cover short-term liquidity needs.