Zoran Cp (Zran)

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Each of the following ratings updates was generated on Jan. 30. ...

Zoran (ZRAN - Cramer's Take - Stockpickr), which makes integrated circuits and products used in DVD players, has been upgraded to a buy. The company's strengths can be seen in its revenue growth, largely solid financial position with reasonable debt levels, impressive earnings-per-share growth, compelling growth in net income and attractive valuation levels. These strengths outweigh the stock's lackluster performance.

Zoran's revenue growth of 34.4% is higher than that of the industry average. Zoran has no debt to speak of, a relatively favorable sign. The company also maintains a quick ratio of 4.14, which clearly demonstrates the ability to cover short-term cash needs.

For the fourth quarter of 2007, Zoran posted income of $58.7 million, or $1.11 a share, vs. a loss of $11 million, or 22 cents, in 2006. At 34%, Zoran's year-over-year revenue growth significantly outpaced the industry average. Zoran sports a price-over-earnings (P/E) ratio of 8.50 and a P/E-to-growth ratio (PEG) of 1.46.