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. TheStreet Ratings quantitative algorithm evaluates over 4,300 stocks on a daily basis by 32 different data factors and assigns a unique buy, sell, or hold recommendation on each stock. Click here to learn more.
"We rate RANDGOLD RESOURCES LTD (GOLD) a BUY. This is driven by a few notable strengths, 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 revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Must Read: Warren Buffett's 25 Favorite Stocks
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 27.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- GOLD's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.10, which illustrates the ability to avoid short-term cash problems.
- 46.30% is the gross profit margin for RANDGOLD RESOURCES LTD which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.09% is above that of the industry average.
- Net operating cash flow has significantly increased by 306.54% to $73.37 million when compared to the same quarter last year. In addition, RANDGOLD RESOURCES LTD has also vastly surpassed the industry average cash flow growth rate of -21.86%.
- RANDGOLD RESOURCES LTD has improved earnings per share by 12.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, RANDGOLD RESOURCES LTD reported lower earnings of $2.99 versus $4.65 in the prior year. This year, the market expects an improvement in earnings ($3.19 versus $2.99).
- You can view the full analysis from the report here: GOLD Ratings Report
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE.