NEW YORK (TheStreet) -- Boston Beer Co. (SAM) shares are up 0.9% to $220.50 on Tuesday after having coverage initiated with a "outperform" rating and $250 price target by analysts at Cowan and Co. (COWN) .
The firm's price target represents a potential 13.8% upside for the Sam Adams beer manufacturer.
TheStreet Ratings team rates BOSTON BEER INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate BOSTON BEER INC (SAM) 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 robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 4.7%. Since the same quarter one year prior, revenues rose by 27.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- BOSTON BEER INC has improved earnings per share by 29.6% 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, BOSTON BEER INC increased its bottom line by earning $5.18 versus $4.40 in the prior year. This year, the market expects an improvement in earnings ($6.50 versus $5.18).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Beverages industry. The net income increased by 29.0% when compared to the same quarter one year prior, rising from $19.72 million to $25.43 million.
- Net operating cash flow has significantly increased by 52.92% to $47.13 million when compared to the same quarter last year. In addition, BOSTON BEER INC has also vastly surpassed the industry average cash flow growth rate of -2.88%.
- SAM's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.71 is somewhat weak and could be cause for future problems.
- You can view the full analysis from the report here: SAM Ratings Report
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