Why PowerSecure International (POWR) Hit A Lifetime High Today

NEW YORK (TheStreet) -- PowerSecure International (POWR) was gaining 9.3% to $25.25, hitting a lifetime high of $27.43 Tuesday following a positive earnings report.

For the fourth quarter PowerSecure posted earnings of 13 cents a share, beating analysts' estimates of 9 cents a share by 4 cents. Revenue increased 66.4%from the year-ago quarter to 73.6 million. Analysts surveyed by Thomson Reuters expected revenue of $69.2 million.

The company's increase in revenue was largely due to gains in its energy efficiency and utility infrastructure businesses.

PowerSecure announced an all-time high revenue backlog of $248 million for the quarter. The company's operating margin dropped to 4.8% in the quarter, compared to 6.7% in the year-ago quarter.

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TheStreet Ratings team rates POWERSECURE INTL INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate POWERSECURE INTL INC (POWR) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, compelling growth in net income, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • POWR's very impressive revenue growth greatly exceeded the industry average of 5.8%. Since the same quarter one year prior, revenues leaped by 84.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • POWR's debt-to-equity ratio is very low at 0.18 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, POWR has a quick ratio of 2.40, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electrical Equipment industry. The net income increased by 620.5% when compared to the same quarter one year prior, rising from $0.48 million to $3.47 million.
  • Powered by its strong earnings growth of 466.66% and other important driving factors, this stock has surged by 148.89% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • POWERSECURE INTL 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, POWERSECURE INTL INC reported lower earnings of $0.17 versus $1.03 in the prior year. This year, the market expects an improvement in earnings ($0.42 versus $0.17).
  • You can view the full analysis from the report here: POWR Ratings Report

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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.

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