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NEW YORK ( TheStreet) -- Brookfield Residential Properties (NYSE: BRP) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

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Highlights from the ratings report include:
  • BROOKFIELD RESIDENTIAL PPTYS 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. During the past fiscal year, BROOKFIELD RESIDENTIAL PPTYS increased its bottom line by earning $1.21 versus $0.90 in the prior year.
  • 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 74.8% when compared to the same quarter one year prior, rising from $24.24 million to $42.38 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.2%. Since the same quarter one year prior, revenues slightly increased by 7.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.93, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • Net operating cash flow has significantly increased by 106.57% to $3.57 million when compared to the same quarter last year. In addition, BROOKFIELD RESIDENTIAL PPTYS has also vastly surpassed the industry average cash flow growth rate of 38.79%.

Brookfield Residential Properties Inc. operates as a land developer and homebuilder in North America. The company constructs single family and multi-family homes; sells lots to homebuilders and third parties; and constructs homes it has developed or purchased from others. Brookfield has a market cap of $2.21 billion and is part of the financial sector and real estate industry. Shares are down 22% year to date as of the close of trading on Wednesday.

You can view the full Brookfield Ratings Report or get investment ideas from our investment research center.

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