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NEW YORK (TheStreet) -- Asta Funding Inc (ASFI) has been upgraded by TheStreet Ratings to "buy" from :hold" with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ASTA FUNDING INC (ASFI) a BUY. This is driven by some important positives, 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 compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth and notable return on equity. 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:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Consumer Finance industry. The net income increased by 299.6% when compared to the same quarter one year prior, rising from -$2.74 million to $5.46 million.
- ASFI's debt-to-equity ratio is very low at 0.15 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- ASFI, with its decline in revenue, underperformed when compared the industry average of 0.4%. Since the same quarter one year prior, revenues fell by 19.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- ASTA FUNDING INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ASTA FUNDING INC reported lower earnings of $0.22 versus $0.70 in the prior year.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Consumer Finance industry and the overall market, ASTA FUNDING INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full analysis from the report here: ASFI Ratings Report
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