SanDisk (SNDK) Stock Gains on Positive Quarter

NEW YORK (TheStreet) -- SanDisk (SNDK) was gaining 2.8% to $78.00 in after-hours trading Wednesday after beating analysts' expectations for earnings in the first quarter and declaring a 22.5 cents a share dividend.

For the first quarter SanDisk reported earnings of $1.44 a share, beating analysts' estimates of $1.25 a share by 19 cents. Revenue grew 12.7% to $1.51 billion in the quarter. Analysts surveyed by Thomson Reuters expected revenue of $1.49 billion for the quarter.

The chipmaker also declared a quarterly dividend of 22.5 cents a share. The dividend is in-line with the company's previous, and is payable on May 27 to shareholders of record as of the close of business May 5.

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TheStreet Ratings team rates SANDISK CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate SANDISK CORP (SNDK) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. 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, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

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

  • SNDK's revenue growth has slightly outpaced the industry average of 4.7%. Since the same quarter one year prior, revenues rose by 12.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although SNDK's debt-to-equity ratio of 0.28 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 3.00, which clearly demonstrates the ability to cover short-term cash needs.
  • SANDISK CORP 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, SANDISK CORP increased its bottom line by earning $4.37 versus $1.69 in the prior year. This year, the market expects an improvement in earnings ($5.80 versus $4.37).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Computers & Peripherals industry. The net income increased by 58.2% when compared to the same quarter one year prior, rising from $213.54 million to $337.78 million.
  • Net operating cash flow has significantly increased by 95.42% to $616.82 million when compared to the same quarter last year. In addition, SANDISK CORP has also vastly surpassed the industry average cash flow growth rate of -4.16%.
  • You can view the full analysis from the report here: SNDK Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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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