TheStreet Ratings Top 10 Rating Changes

Tickers in this article: BDE DO LPX NTRS PRU SAFM TAP TWI VALE VRTX

NEW YORK (TheStreet Ratings) -- Every trading day TheStreet Ratings' stock model reviews the investment ratings on around 4,700 U.S. traded stocks for potential upgrades or downgrades based on the latest available financial results and trading activity.

TheStreet Ratings released rating changes on 99 U.S. common stocks for week ending June 1, 2012. 24 stocks were upgraded and 75 stocks were downgraded by our stock model.

Rating Change #10

Molson Coors Brewing Company has been downgraded by TheStreet Ratings from buy to hold. 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 and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, a generally disappointing performance in the stock itself and deteriorating net income.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 1.5%. Since the same quarter one year prior, revenues slightly increased by 0.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • TAP's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.40, which illustrates the ability to avoid short-term cash problems.
  • 44.20% is the gross profit margin for MOLSON COORS BREWING CO which we consider to be strong. Regardless of TAP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 11.50% trails the industry average.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Beverages industry average. The net income has decreased by 4.1% when compared to the same quarter one year ago, dropping from $82.90 million to $79.50 million.
  • 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. In comparison to the other companies in the Beverages industry and the overall market, MOLSON COORS BREWING CO's return on equity is significantly below that of the industry average and is below that of the S&P 500.

Molson Coors Brewing Company manufactures and sells beer and other beverage products. The company has a P/E ratio of 10.9, below the average food & beverage industry P/E ratio of 11 and below the S&P 500 P/E ratio of 17.7. Molson Coors Brewing has a market cap of $6.2 billion and is part of the consumer goods sector and food & beverage industry. Shares are down 8.6% year to date as of the close of trading on Wednesday.

You can view the full Molson Coors Brewing Ratings Report or get investment ideas from our investment research center.

Rating Change #9

Diamond Offshore Drilling Inc has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.34, 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 4.82, which clearly demonstrates the ability to cover short-term cash needs.
  • 46.60% is the gross profit margin for DIAMOND OFFSHRE DRILLING INC which we consider to be strong. Regardless of DO's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DO's net profit margin of 24.10% significantly outperformed against the industry.
  • DO, with its decline in revenue, underperformed when compared the industry average of 14.1%. Since the same quarter one year prior, revenues slightly dropped by 4.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Energy Equipment & Services industry average. The net income has significantly decreased by 26.1% when compared to the same quarter one year ago, falling from $250.61 million to $185.17 million.
  • Net operating cash flow has decreased to $349.84 million or 13.93% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, DIAMOND OFFSHRE DRILLING INC has marginally lower results.

Diamond Offshore Drilling, Inc. operates as an offshore oil and gas drilling contractor worldwide. It offers a range of services in the ultra-deepwater, deepwater, and mid-water markets, as well as in the non-floater or jack-up market. The company has a P/E ratio of 9.5, equal to the average energy industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are up 7.6% year to date as of the close of trading on Thursday.

Rating Change #8

Northern Trust Corporation has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 22.9%. Since the same quarter one year prior, revenues slightly increased by 3.9%. 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 Capital Markets industry average. The net income increased by 6.8% when compared to the same quarter one year prior, going from $151.00 million to $161.20 million.
  • NORTHERN TRUST CORP 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, NORTHERN TRUST CORP reported lower earnings of $2.46 versus $2.74 in the prior year. This year, the market expects an improvement in earnings ($2.97 versus $2.46).
  • NTRS has underperformed the S&P 500 Index, declining 11.56% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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 Capital Markets industry and the overall market, NORTHERN TRUST CORP's return on equity is below that of both the industry average and the S&P 500.

Northern Trust Corporation, through its subsidiaries, provides asset servicing, fund administration, asset management, and fiduciary and banking solutions for corporations, institutions, families, and individuals worldwide. The company has a P/E ratio of 17.4, equal to the average banking industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Northern Trust has a market cap of $10.6 billion and is part of the financial sector and banking industry. Shares are up 10.8% year to date as of the close of trading on Thursday.

You can view the full Northern Trust Ratings Report or get investment ideas from our investment research center.

Rating Change #7

Prudential Financial Inc has been downgraded by TheStreet Ratings from buy to hold. Among the primary strengths of the company is its reasonable valuation levels, considering its current price compared to earnings, book value and other measures. At the same time, however, we also find weaknesses including deteriorating net income, generally poor debt management and disappointing return on equity.

Highlights from the ratings report include:

  • PRU, with its decline in revenue, underperformed when compared the industry average of 13.1%. Since the same quarter one year prior, revenues slightly dropped by 5.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • PRUDENTIAL FINANCIAL INC has exprienced 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. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, PRUDENTIAL FINANCIAL INC increased its bottom line by earning $7.04 versus $5.69 in the prior year. For the next year, the market is expecting a contraction of 7.0% in earnings ($6.55 versus $7.04).
  • The debt-to-equity ratio of 1.01 is relatively high when compared with the industry average, suggesting a need for better debt level management.
  • 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 Insurance industry and the overall market, PRUDENTIAL FINANCIAL INC's return on equity is below that of both the industry average and the S&P 500.

Prudential Financial, Inc., through its subsidiaries, provides various financial products and services, including life insurance, annuities, retirement-related services, mutual funds, and investment management services in the United States, Asia, Europe, and Latin America. The company has a P/E ratio of 12.1, equal to the average insurance industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Prudential Financial has a market cap of $22.36 billion and is part of the financial sector and insurance industry. Shares are down 6.9% year to date as of the close of trading on Thursday.

You can view the full Prudential Financial Ratings Report or get investment ideas from our investment research center.

Rating Change #6

Vale SA has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.32, is low and is below the industry average, implying that there has been successful management of debt levels. 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 gross profit margin for VALE SA is rather high; currently it is at 57.40%. Regardless of VALE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, VALE's net profit margin of 34.30% significantly outperformed against the industry.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Metals & Mining industry. The net income has significantly decreased by 46.8% when compared to the same quarter one year ago, falling from $6,932.51 million to $3,691.51 million.
  • Net operating cash flow has significantly decreased to $3,098.78 million or 53.50% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, VALE SA has marginally lower results.

Vale S.A. engages in the exploration, production, and sale of basic metals in Brazil and internationally. The company is also involved in fertilizers, logistics, and steel businesses. The company has a P/E ratio of 4.3, equal to the average metals & mining industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Vale has a market cap of $93.94 billion and is part of the basic materials sector and metals & mining industry. Shares are down 13.9% year to date as of the close of trading on Friday.

You can view the full Vale Ratings Report or get investment ideas from our investment research center.

Rating Change #5

Black Diamond Inc 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, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 2.2%. Since the same quarter one year prior, revenues rose by 18.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • BDE's debt-to-equity ratio is very low at 0.07 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 4.43, which clearly demonstrates the ability to cover short-term cash needs.
  • 42.50% is the gross profit margin for BLACK DIAMOND INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 5.60% is above that of the industry average.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Leisure Equipment & Products industry. The net income increased by 121.7% when compared to the same quarter one year prior, rising from $1.17 million to $2.59 million.
  • Net operating cash flow has increased to $0.52 million or 25.66% when compared to the same quarter last year. Despite an increase in cash flow of 25.66%, BLACK DIAMOND INC is still growing at a significantly lower rate than the industry average of 81.73%.

Black Diamond, Inc., together with its subsidiaries, engages in designing, manufacturing, and marketing outdoor performance products for climbing, mountaineering, backpacking, skiing, and other outdoor recreation activities in the United States and internationally. The company has a P/E ratio of 33.9, equal to the average consumer durables industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Black has a market cap of $280.5 million and is part of the consumer goods sector and consumer durables industry. Shares are up 24.1% year to date as of the close of trading on Wednesday.

You can view the full Black Ratings Report or get investment ideas from our investment research center.

Rating Change #4

Titan International Inc 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, largely solid financial position with reasonable debt levels by most measures, notable return on equity, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:

  • TWI's very impressive revenue growth greatly exceeded the industry average of 15.9%. Since the same quarter one year prior, revenues leaped by 64.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.72, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, TWI has a quick ratio of 1.77, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 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 Machinery industry and the overall market, TITAN INTERNATIONAL INC's return on equity exceeds that of both the industry average and the S&P 500.
  • TITAN INTERNATIONAL 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, TITAN INTERNATIONAL INC turned its bottom line around by earning $1.14 versus -$0.18 in the prior year. This year, the market expects an improvement in earnings ($2.63 versus $1.14).

Titan International, Inc. and its subsidiaries manufacture and sell wheels, tires, and assemblies for off-highway vehicles used in the agricultural, earthmoving/construction, and consumer markets in the United States. The company has a P/E ratio of 12.1, below the average consumer non-durables industry P/E ratio of 12.4 and below the S&P 500 P/E ratio of 17.7. Titan International has a market cap of $985.5 million and is part of the consumer goods sector and consumer non-durables industry. Shares are up 22.8% year to date as of the close of trading on Wednesday.

You can view the full Titan International Ratings Report or get investment ideas from our investment research center.

Rating Change #3

Louisiana-Pacific Corp has been upgraded by TheStreet Ratings from sell to hold. 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 and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • LPX's revenue growth has slightly outpaced the industry average of 8.5%. Since the same quarter one year prior, revenues slightly increased by 9.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.74, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, LPX has a quick ratio of 2.49, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has slightly increased to -$64.40 million or 5.84% when compared to the same quarter last year. Despite an increase in cash flow, LOUISIANA-PACIFIC CORP's average is still marginally south of the industry average growth rate of 12.84%.
  • The gross profit margin for LOUISIANA-PACIFIC CORP is currently extremely low, coming in at 13.30%. Regardless of LPX's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -3.10% trails the industry average.
  • 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 Paper & Forest Products industry and the overall market, LOUISIANA-PACIFIC CORP's return on equity significantly trails that of both the industry average and the S&P 500.

Louisiana-Pacific Corporation, together with its subsidiaries, engages in manufacturing and distributing building products for new home construction, repair and remodeling, manufactured housing, and light industrial and commercial construction. Louisiana-Pacific has a market cap of $1.32 billion and is part of the industrial goods sector and materials & construction industry. Shares are up 18.7% year to date as of the close of trading on Wednesday.

You can view the full Louisiana-Pacific Ratings Report or get investment ideas from our investment research center.

Rating Change #2

Sanderson Farms Inc has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, increase in net income, good cash flow from operations and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 24.6%. Since the same quarter one year prior, revenues rose by 24.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 246.6% when compared to the same quarter one year prior, rising from -$16.28 million to $23.87 million.
  • Net operating cash flow has significantly increased by 288.09% to $130.30 million when compared to the same quarter last year. In addition, SANDERSON FARMS INC has also vastly surpassed the industry average cash flow growth rate of -2638.68%.
  • SANDERSON FARMS INC reported significant earnings per share improvement 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, SANDERSON FARMS INC swung to a loss, reporting -$5.74 versus $6.00 in the prior year. This year, the market expects an improvement in earnings ($3.66 versus -$5.74).

Sanderson Farms, Inc., an integrated poultry processing company, engages in the production, processing, marketing, and distribution of fresh, frozen, and prepared chicken products in the United States. Sanderson Farms has a market cap of $1.17 billion and is part of the consumer goods sector and food & beverage industry. Shares are up 6.6% year to date as of the close of trading on Thursday.

You can view the full Sanderson Farms Ratings Report or get investment ideas from our investment research center.

Rating Change #1

Vertex Pharmaceuticals 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, largely solid financial position with reasonable debt levels by most measures, notable return on equity, impressive record of earnings per share growth and compelling growth in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • VRTX's very impressive revenue growth greatly exceeded the industry average of 4.1%. Since the same quarter one year prior, revenues leaped by 495.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.53, 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 3.56, which clearly demonstrates the ability to cover short-term cash needs.
  • 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, VERTEX PHARMACEUTICALS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • VERTEX PHARMACEUTICALS 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, VERTEX PHARMACEUTICALS INC turned its bottom line around by earning $0.04 versus -$3.77 in the prior year. This year, the market expects an improvement in earnings ($2.65 versus $0.04).
  • 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 152.0% when compared to the same quarter one year prior, rising from -$176.10 million to $91.59 million.

Vertex Pharmaceuticals Incorporated engages in discovering, developing, manufacturing, and commercializing small molecule drugs for the treatment of serious diseases worldwide. The company has a P/E ratio of 39.9, below the average drugs industry P/E ratio of 42.2 and above the S&P 500 P/E ratio of 17.7. Vertex has a market cap of $12.2 billion and is part of the health care sector and drugs industry. Shares are up 74% year to date as of the close of trading on Thursday.

You can view the full Vertex Ratings Report or get investment ideas from our investment research center.

-- Reported by Kevin Baker in Jupiter, Fla.

For additional Investment Research check out our Ratings Research Center.

For all other upgrades and downgrades made by TheStreet Ratings Model today check out our upgrades and downgrades list.

Tickers in this article: BDE DO LPX NTRS PRU SAFM TAP TWI VALE VRTX