10 S&P 500 Companies to Have the Most Revenue Growth in 2015

NEW YORK (TheStreet) -- Which S&P 500 companies are poised to have the biggest revenue growth this year?

With first-quarter earnings reports just about wrapped up after several big retail chains issued results this week, S&P Capital IQ, a division of McGraw Hill Financial (MHFI), analyzed revenue estimates for companies with market capitalization of at least $20 billion to identify those most likely produce the largest year-over-year revenue growth in 2015. (The analysis excludes the REIT sub-industry as well as companies with growth driven by one-time items, such as acquisitions,it said.) The analysis is based on overall analysts' consensus 2015 revenue estimates as tallied by S&P Capital IQ.

The top 10 list is overwhelmingly weighted toward the health care sector, with seven companies in the biotech or pharmaceuticals industries.

"Acquisitions and new drug approvals continue stimulating both subsectors," the May 18 report said. "Notably, we only included companies that have consistently completed acquisitions as a normal course of business in this analysis (we excluded companies with large one-time acquisitions)."

Tech companies also dominate the list.

"Facebook Inc. (FB), Netflix Inc. (NFLX), and Salesforce.com Inc. (CRM) complete the revenue growth list, which isn't surprising considering the top-line momentum for all three of these companies," the report said.

Check out the companies that are expected to produce the largest revenue growth in 2015. We paired the companies with ratings from TheStreet Ratings. And when you're done, be sure to check out which companies are expected to have the biggest profit growth this year. 

TheStreet Ratings, TheStreet's proprietary ratings tool, projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Based on 32 major data points, TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

Note: Year-to-date returns are based on May 19, 2015 closing prices.

GILD Chart GILD data by YCharts

10. Gilead Sciences (GILD)
Market Cap: $163.3 billion
Year-to-date return: 17.3%
2015 Consensus Revenue Growth Estimate: 19.69%

S&P Capital IQ Rating/Price Target: Strong Buy/$143 PT

TheStreet Ratings: Buy, A
TheStreet Ratings said:
"We rate GILEAD SCIENCES INC (GILD) 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, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and notable return on equity. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • GILD's very impressive revenue growth greatly exceeded the industry average of 19.9%. Since the same quarter one year prior, revenues leaped by 51.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 107.51% and other important driving factors, this stock has surged by 34.29% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GILD should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • GILEAD SCIENCES INC 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. We feel that this trend should continue. During the past fiscal year, GILEAD SCIENCES INC increased its bottom line by earning $7.38 versus $1.83 in the prior year. This year, the market expects an improvement in earnings ($10.70 versus $7.38).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Biotechnology industry. The net income increased by 94.5% when compared to the same quarter one year prior, rising from $2,227.41 million to $4,333.00 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, GILEAD SCIENCES INC's return on equity significantly exceeds that of both the industry average and the S&P 500.

 

 

CELG Chart CELG data by YCharts

9. Celgene Corp. (CELG)
Market Cap: $92.7 billion
Year-to-date return: 4.5%
2015 Consensus Revenue Growth Estimate: 20.68%

S&P Capital IQ Rating/Price Target: Strong Buy/$146 PT

TheStreet Ratings: Buy, B+
TheStreet Ratings said:
"We rate CELGENE CORP (CELG) 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 robust revenue growth, notable return on equity, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • CELG's revenue growth has slightly outpaced the industry average of 19.9%. Since the same quarter one year prior, revenues rose by 20.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 160.60% and other important driving factors, this stock has surged by 51.66% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CELG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • CELGENE CORP 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. We feel that this trend should continue. During the past fiscal year, CELGENE CORP increased its bottom line by earning $2.40 versus $1.69 in the prior year. This year, the market expects an improvement in earnings ($4.78 versus $2.40).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Biotechnology industry. The net income increased by 157.0% when compared to the same quarter one year prior, rising from $279.70 million to $718.90 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Biotechnology industry and the overall market, CELGENE CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.

 

CRM Chart CRM data by YCharts

8. Salesforce.com (CRM)
Market Cap: $46.9 billion
Year-to-date return: 20.5%
2015 Consensus Revenue Growth Estimate: 21.16%

S&P Capital IQ Rating/Price Target: Hold/$79 PT

TheStreet Ratings: Hold, C
TheStreet Ratings said:
"We rate SALESFORCE.COM INC (CRM) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and increase in net income. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 1.5%. Since the same quarter one year prior, revenues rose by 26.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Powered by its strong earnings growth of 47.36% and other important driving factors, this stock has surged by 40.47% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • SALESFORCE.COM INC has improved earnings per share by 47.4% 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, SALESFORCE.COM INC reported poor results of -$0.42 versus -$0.40 in the prior year. This year, the market expects an improvement in earnings ($0.69 versus -$0.42).
  • 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. Compared to other companies in the Software industry and the overall market, SALESFORCE.COM INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite currently having a low debt-to-equity ratio of 0.38, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that CRM's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.66 is low and demonstrates weak liquidity.

 

NFLX Chart NFLX data by YCharts

7. Netflix (NFLX)
Market Cap: $37.4 billion

Year-to-date return: 80.4%
2015 Consensus Revenue Growth Estimate: 23.27%

S&P Capital IQ Rating/Price Target: Buy/$595 PT

TheStreet Ratings: Hold, C+
TheStreet Ratings said:
"We rate NETFLIX INC (NFLX) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and premium valuation."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • NFLX's revenue growth has slightly outpaced the industry average of 19.1%. Since the same quarter one year prior, revenues rose by 23.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The gross profit margin for NETFLIX INC is currently very high, coming in at 83.44%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 1.50% is above that of the industry average.
  • 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. Compared to other companies in the Internet & Catalog Retail industry and the overall market on the basis of return on equity, NETFLIX INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • Net operating cash flow has significantly decreased to -$127.38 million or 450.34% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

 

MYL Chart MYL data by YCharts

6. Mylan (MYL)
Market Cap: $35 billion

Year-to-date return: 26.6%
2015 Consensus Revenue Growth Estimate: 26.02%

S&P Capital IQ Rating/Price Target: Buy/$92 PT

TheStreet Ratings: Buy, B+
TheStreet Ratings said:
"We rate MYLAN NV (MYL) 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 revenue growth, solid stock price performance, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 8.0%. Since the same quarter one year prior, revenues slightly increased by 9.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, MYL's share price has jumped by 50.71%, exceeding the performance of the broader market during that same time frame. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • The gross profit margin for MYLAN NV is rather high; currently it is at 54.78%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, MYL's net profit margin of 3.02% significantly trails the industry average.
  • MYLAN NV has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, MYLAN NV increased its bottom line by earning $2.34 versus $1.58 in the prior year. This year, the market expects an improvement in earnings ($4.15 versus $2.34).
  • 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. Despite the fact that MYL's debt-to-equity ratio is low, the quick ratio, which is currently 0.52, displays a potential problem in covering short-term cash needs.

 

 

REGN Chart REGN data by YCharts

5. Regeneron Pharmaceuticals Inc. (REGN)
Market Cap: $52.1 billion

Year-to-date return: 22.9%
2015 Consensus Revenue Growth Estimate: 26.78%

S&P Capital IQ Rating/Price Target: Buy/$520 PT

TheStreet Ratings: Buy, B
TheStreet Ratings said:
"We rate REGENERON PHARMACEUTICALS (REGN) 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 robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and increase in net income. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 19.9%. Since the same quarter one year prior, revenues rose by 39.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • REGN's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.88, which clearly demonstrates the ability to cover short-term cash needs.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 71.00% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • REGENERON PHARMACEUTICALS has improved earnings per share by 8.2% 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, REGENERON PHARMACEUTICALS reported lower earnings of $3.09 versus $3.80 in the prior year. This year, the market expects an improvement in earnings ($11.05 versus $3.09).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Biotechnology industry average, but is greater than that of the S&P 500. The net income increased by 11.3% when compared to the same quarter one year prior, going from $68.31 million to $76.02 million.

 

PRGO Chart PRGO data by YCharts

4. Perrigo Co. (PRGO)
Market Cap: $28.9 billion

Year-to-date return: 18.3%
2015 Consensus Revenue Growth Estimate: 32.12%

S&P Capital IQ Rating/Price Target: Hold/$222 PT

TheStreet Ratings: Buy, B
TheStreet Ratings said:
"We rate PERRIGO CO PLC (PRGO) 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 revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, expanding profit margins and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 8.0%. Since the same quarter one year prior, revenues slightly increased by 4.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 3.37, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has increased to $267.90 million or 48.42% when compared to the same quarter last year. In addition, PERRIGO CO PLC has also vastly surpassed the industry average cash flow growth rate of -21.42%.
  • 48.07% is the gross profit margin for PERRIGO CO PLC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -9.05% is in-line with the industry average.
  • Compared to its closing price of one year ago, PRGO's share price has jumped by 47.91%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.

 

 

FB Chart FB data by YCharts

3. Facebook (FB)
Market Cap: $226.3 billion

Year-to-date return: 3.3%
2015 Consensus Revenue Growth Estimate: 36.44%

S&P Capital IQ Rating/Price Target: Buy/$93 PT

TheStreet Ratings: Hold, C
TheStreet Ratings said:
"We rate FACEBOOK INC (FB) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, disappointing return on equity and premium valuation."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth greatly exceeded the industry average of 5.8%. Since the same quarter one year prior, revenues rose by 41.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • FB's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 7.97, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has increased to $1,700.00 million or 32.29% when compared to the same quarter last year. Despite an increase in cash flow, FACEBOOK INC's average is still marginally south of the industry average growth rate of 41.37%.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Internet Software & Services industry and the overall market, FACEBOOK INC's return on equity is below that of both the industry average and the S&P 500.

 

ACT Chart ACT data by YCharts

2. Actavis (ACT)
Market Cap: $117.2 billion

Year-to-date return: 15.9%
2015 Consensus Revenue Growth Estimate: 65.26%

S&P Capital IQ Rating/Price Target: Buy/$360 PT

TheStreet Ratings: Buy, B-
TheStreet Ratings said:
"We rate ACTAVIS PLC (ACT) 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 robust revenue growth, solid stock price performance, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • ACT's very impressive revenue growth greatly exceeded the industry average of 8.0%. Since the same quarter one year prior, revenues leaped by 59.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, ACT's share price has jumped by 44.34%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ACT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has increased to $525.00 million or 30.37% when compared to the same quarter last year. In addition, ACTAVIS PLC has also vastly surpassed the industry average cash flow growth rate of -21.42%.
  • The gross profit margin for ACTAVIS PLC is rather high; currently it is at 68.80%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -12.09% is in-line with the industry average.
  • The debt-to-equity ratio is somewhat low, currently at 0.62, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.80 is somewhat weak and could be cause for future problems.

 

VRTX Chart VRTX data by YCharts

1. Vertex Pharmaceuticals (VRTX)
Market Cap: $31.2 billion

Year-to-date return: 8%
2015 Consensus Revenue Growth Estimate: 70.62%

S&P Capital IQ Rating/Price Target: Buy/$160 PT

TheStreet Ratings: Sell, D+
TheStreet Ratings said:
"We rate VERTEX PHARMACEUTICALS INC (VRTX) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Biotechnology industry and the overall market, VERTEX PHARMACEUTICALS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to -$207.18 million or 17.87% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Biotechnology industry average, but is greater than that of the S&P 500. The net income increased by 14.6% when compared to the same quarter one year prior, going from -$232.46 million to -$198.61 million.
  • VERTEX PHARMACEUTICALS INC has improved earnings per share by 17.0% 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, VERTEX PHARMACEUTICALS INC reported poor results of -$3.14 versus -$2.29 in the prior year. This year, the market expects an improvement in earnings (-$1.25 versus -$3.14).
  • VRTX's debt-to-equity ratio of 0.85 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 4.17 is very high and demonstrates very strong liquidity.

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