NEW YORK (TheStreet) -- Aspen Technology Inc. was downgraded today to "sector perform" ataPacific Crest Securities. The global provider of process optimization software solutions shows "little upside to valuation," analysts said. "After another quarter of decelerating Total License Contract Value and annual spending, it's becoming more clear that Aspen Technology is only a low double-digit grower, providing little upside to valuation from current levels," analysts said. Must Read: Warren Buffett's 25 Favorite Stocks STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. Shares of Aspen are down 10.47% to $36 in pre-market trading. TheStreet Ratings team rates ASPEN TECHNOLOGY INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate ASPEN TECHNOLOGY INC (AZPN) 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 impressive record of earnings per share growth, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook." Highlights from the analysis by TheStreet Ratings Team goes as follows: ASPEN TECHNOLOGY INC has improved earnings per share by 38.1% 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, ASPEN TECHNOLOGY INC increased its bottom line by earning $0.92 versus $0.47 in the prior year. This year, the market expects an improvement in earnings ($1.21 versus $0.92). The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 30.8% when compared to the same quarter one year prior, rising from $20.40 million to $26.68 million. Despite its growing revenue, the company underperformed as compared with the industry average of 25.7%. Since the same quarter one year prior, revenues rose by 21.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share. AZPN 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. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.16, which illustrates the ability to avoid short-term cash problems. 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 Software industry and the overall market, ASPEN TECHNOLOGY INC's return on equity significantly exceeds that of both the industry average and the S&P 500. You can view the full analysis from the report here: AZPN Ratings Report STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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