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) -- Libbey (AMEX: LBY) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
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- Powered by its strong earnings growth of 500.00% and other important driving factors, this stock has surged by 36.42% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- LIBBEY INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LIBBEY INC increased its bottom line by earning $1.29 versus $0.31 in the prior year. This year, the market expects an improvement in earnings ($2.31 versus $1.29).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Household Durables industry. The net income increased by 477.8% when compared to the same quarter one year prior, rising from $1.61 million to $9.29 million.
- LBY's revenue growth trails the industry average of 28.4%. Since the same quarter one year prior, revenues slightly increased by 1.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Household Durables industry and the overall market, LIBBEY INC's return on equity exceeds that of both the industry average and the S&P 500.