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) -- Entravision Communications Corporation (NYSE: EVC) 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, compelling growth in net income, attractive valuation levels, expanding profit margins and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
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- Powered by its strong earnings growth of 1755.55% and other important driving factors, this stock has surged by 102.76% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, EVC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 1863.0% when compared to the same quarter one year prior, rising from $7.70 million to $151.09 million.
- The gross profit margin for ENTRAVISION COMMUNICATIONS is rather high; currently it is at 54.05%. Regardless of EVC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EVC's net profit margin of 251.43% significantly outperformed against the industry.
- ENTRAVISION COMMUNICATIONS 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, ENTRAVISION COMMUNICATIONS increased its bottom line by earning $1.48 versus $0.15 in the prior year. For the next year, the market is expecting a contraction of 62.8% in earnings ($0.55 versus $1.48).