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NEW YORK (TheStreet) -- Bowl America (BWL.A - Get Report) has been upgraded by TheStreet Ratings from Hold to Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate BOWL AMERICA INC (BWL.A) a BUY. This is driven by several positive factors, 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, increase in net income, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. 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:
- BWL.A's revenue growth has slightly outpaced the industry average of 7.6%. Since the same quarter one year prior, revenues slightly increased by 0.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Hotels, Restaurants & Leisure industry average. The net income increased by 29.9% when compared to the same quarter one year prior, rising from $0.37 million to $0.48 million.
- Net operating cash flow has increased to $1.65 million or 11.48% when compared to the same quarter last year. In addition, BOWL AMERICA INC has also vastly surpassed the industry average cash flow growth rate of -38.80%.
- BWL.A has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Despite the fact that BWL.A's debt-to-equity ratio is low, the quick ratio, which is currently 0.65, displays a potential problem in covering short-term cash needs.
- BOWL AMERICA INC has improved earnings per share by 28.6% 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, BOWL AMERICA INC reported lower earnings of $0.27 versus $0.30 in the prior year.
- You can view the full analysis from the report here: BWL.A Ratings Report