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) -- Zygo Corporation (Nasdaq: ZIGO) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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- The revenue growth greatly exceeded the industry average of 2.5%. Since the same quarter one year prior, revenues rose by 39.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- ZIGO has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.55, which clearly demonstrates the ability to cover short-term cash needs.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income increased by 376.3% when compared to the same quarter one year prior, rising from $0.84 million to $3.99 million.
- The gross profit margin for ZYGO CORP is rather high; currently it is at 51.49%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.28% is above that of the industry average.
- ZYGO CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ZYGO CORP reported lower earnings of $0.33 versus $2.29 in the prior year.