Joe's Jeans Inc. Stock Upgraded (JOEZ)
Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model .
NEW YORK ( TheStreet) -- Joe's Jeans (JOEZ"> JOEZ) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 1.8%. Since the same quarter one year prior, revenues rose by 25.5%. 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 significantly exceeded that of the S&P 500 and the Textiles, Apparel & Luxury Goods industry. The net income increased by 168.2% when compared to the same quarter one year prior, rising from -$2.04 million to $1.39 million.
- Net operating cash flow has significantly increased by 211.36% to $5.54 million when compared to the same quarter last year. In addition, JOE'S JEANS INC has also vastly surpassed the industry average cash flow growth rate of 3.38%.
- 45.60% is the gross profit margin for JOE'S JEANS INC 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 4.58% trails the industry average.
- JOEZ's debt-to-equity ratio is very low at 0.04 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 0.77 is somewhat weak and could be cause for future problems.
Joe's Jeans Inc. designs, develops, produces, and sells apparel and apparel-related products. Its product line comprises women's and men's denim jeans, pants, shirts, sweaters, jackets, and other apparel products under the Joe's brand. The company has a P/E ratio of 18.4, above the S&P 500 P/E ratio of 17.7. Joe's Jeans has a market cap of $98.4 million and is part of the consumer goods sector and consumer non-durables industry. Shares are up 47% year to date as of the close of trading on Monday.