TheStreet Ratings Top 10 Rating Changes

Tickers in this article: BHI CLX CYH DRC EPR GEF LEN LINE PCL RIMM

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 72 U.S. common stocks for week ending June 29, 2012. 41 stocks were upgraded and 31 stocks were downgraded by our stock model.

Rating Change #10

Greif Inc 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, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and generally poor debt management.

Highlights from the ratings report include:
  • GEF's revenue growth trails the industry average of 23.6%. Since the same quarter one year prior, revenues slightly increased by 4.2%. 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.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Containers & Packaging industry and the overall market, GREIF INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for GREIF INC is rather low; currently it is at 22.20%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.40% trails that of the industry average.

Greif, Inc. manufactures and sells industrial packaging products, bulk containers, and containerboard and corrugated products worldwide. The company has a P/E ratio of 16.8, above the average consumer non-durables industry P/E ratio of 11.1 and below the S&P 500 P/E ratio of 17.7. Greif has a market cap of $1.04 billion and is part of the consumer goods sector and consumer non-durables industry. Shares are down 9.1% year to date as of the close of trading on Tuesday.

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

Rating Change #9

Entertainment Properties Trust 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 deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • EPR's revenue growth trails the industry average of 18.0%. Since the same quarter one year prior, revenues slightly increased by 4.8%. 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 debt-to-equity ratio is somewhat low, currently at 0.84, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • Net operating cash flow has increased to $41.96 million or 19.86% when compared to the same quarter last year. Despite an increase in cash flow, ENTERTAINMENT PROPERTIES TR's average is still marginally south of the industry average growth rate of 25.83%.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 48.8% when compared to the same quarter one year ago, falling from $41.73 million to $21.37 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. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, ENTERTAINMENT PROPERTIES TR's return on equity is below that of both the industry average and the S&P 500.

Entertainment Properties Trust, a real estate investment trust (REIT), develops, owns, leases, and finances entertainment and related properties in the United States and Canada. The company has a P/E ratio of 26.6, below the average real estate industry P/E ratio of 28.9 and above the S&P 500 P/E ratio of 17.7. Entertainment has a market cap of $1.89 billion and is part of the financial sector and real estate industry. Shares are down 7.6% year to date as of the close of trading on Friday.

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

Rating Change #8

Dresser-Rand Group Inc has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally poor debt management, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • DRC's very impressive revenue growth greatly exceeded the industry average of 14.1%. Since the same quarter one year prior, revenues leaped by 86.8%. Growth in the company's revenue appears to have helped boost 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 Energy Equipment & Services industry. The net income increased by 5800.0% when compared to the same quarter one year prior, rising from $0.40 million to $23.60 million.
  • DRESSER-RAND GROUP INC has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. 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, DRESSER-RAND GROUP INC reported lower earnings of $1.55 versus $1.80 in the prior year. This year, the market expects an improvement in earnings ($2.84 versus $1.55).
  • The debt-to-equity ratio of 1.15 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, DRC has a quick ratio of 0.63, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • The gross profit margin for DRESSER-RAND GROUP INC is currently lower than what is desirable, coming in at 25.00%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.60% trails that of the industry average.

Dresser-Rand Group Inc., together with its subsidiaries, engages in the design, manufacture, sale, and servicing of custom-engineered rotating equipment solutions to the oil, gas, chemical, petrochemical, process, power, military, and other industries worldwide. The company has a P/E ratio of 22.9, above the average industrial industry P/E ratio of 22.7 and above the S&P 500 P/E ratio of 17.7. Dresser-Rand Group has a market cap of $3.18 billion and is part of the industrial goods sector and industrial industry. Shares are down 17.6% year to date as of the close of trading on Wednesday.

You can view the full Dresser-Rand Group Ratings Report or get investment ideas from our investment research center.

Rating Change #7

Research In Motion Ltd has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • RESEARCH IN MOTION LTD 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. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, RESEARCH IN MOTION LTD reported lower earnings of $2.23 versus $6.36 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Communications Equipment industry. The net income has significantly decreased by 174.5% when compared to the same quarter one year ago, falling from $695.00 million to -$518.00 million.
  • 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 Communications Equipment industry and the overall market, RESEARCH IN MOTION LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $711.00 million or 30.29% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 67.67%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 174.43% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

Research In Motion Limited designs, manufactures, and markets wireless solutions for the mobile communications market worldwide. The company has a P/E ratio of 4.1, equal to the average telecommunications industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Research in Motion has a market cap of $4.81 billion and is part of the technology sector and telecommunications industry. Shares are down 37% year to date as of the close of trading on Friday.

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

Rating Change #6

Baker Hughes Inc has been downgraded by TheStreet Ratings from buy to hold. 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 attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:
  • BHI's revenue growth has slightly outpaced the industry average of 14.2%. Since the same quarter one year prior, revenues rose by 18.3%. 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.
  • BHI's debt-to-equity ratio is very low at 0.28 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, BHI has a quick ratio of 1.51, which demonstrates the ability of the company to cover short-term liquidity needs.
  • BAKER HUGHES INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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, BAKER HUGHES INC increased its bottom line by earning $3.97 versus $2.00 in the prior year. For the next year, the market is expecting a contraction of 8.8% in earnings ($3.62 versus $3.97).
  • Net operating cash flow has significantly decreased to -$76.00 million or 200.00% 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 change in net income from the same quarter one year ago, has significantly underperformed compared to the Energy Equipment & Services industry average, but is greater than that of the S&P 500. The net income has decreased by 0.5% when compared to the same quarter one year ago, dropping from $381.00 million to $379.00 million.

Baker Hughes Incorporated supplies oilfield services, products, and technology services and systems to the oil and natural gas industry worldwide. The company has a P/E ratio of 9.9, equal to the average energy industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Baker Hughes has a market cap of $17.16 billion and is part of the basic materials sector and energy industry. Shares are down 19.5% year to date as of the close of trading on Tuesday.

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

Rating Change #5

Community Health Systems Inc has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, revenue growth, attractive valuation levels 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 company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Health Care Providers & Services industry average. The net income increased by 23.1% when compared to the same quarter one year prior, going from $61.32 million to $75.47 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 13.1%. Since the same quarter one year prior, revenues rose by 10.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • COMMUNITY HEALTH SYSTEMS INC's earnings per share improvement from the most recent quarter was slightly positive. 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, COMMUNITY HEALTH SYSTEMS INC reported lower earnings of $2.86 versus $3.09 in the prior year. This year, the market expects an improvement in earnings ($3.64 versus $2.86).

Community Health Systems, Inc., together with its subsidiaries, provides general and specialized hospital healthcare services to patients in the United States. The company has a P/E ratio of 8.8, below the average health services industry P/E ratio of 11.3 and below the S&P 500 P/E ratio of 17.7. Community Health Systems has a market cap of $2.34 billion and is part of the health care sector and health services industry. Shares are up 57.8% year to date as of the close of trading on Friday.

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

Rating Change #4

Lennar Corporation 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, notable return on equity, solid stock price performance, compelling growth in net income and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 30.8%. Since the same quarter one year prior, revenues rose by 21.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 Household Durables industry and the overall market, LENNAR CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • Powered by its strong earnings growth of 2842.85% and other important driving factors, this stock has surged by 55.63% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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 net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Household Durables industry. The net income increased by 3184.0% when compared to the same quarter one year prior, rising from $13.79 million to $452.70 million.
  • LENNAR CORP 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, LENNAR CORP reported lower earnings of $0.48 versus $0.50 in the prior year. This year, the market expects an improvement in earnings ($0.85 versus $0.48).

Lennar Corporation, together with its subsidiaries, engages in homebuilding, financial services, and real estate businesses in the United States. The company has a P/E ratio of 65.2, below the average materials & construction industry P/E ratio of 66.8 and above the S&P 500 P/E ratio of 17.7. Lennar has a market cap of $4.33 billion and is part of the industrial goods sector and materials & construction industry. Shares are up 39.4% year to date as of the close of trading on Thursday.

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

Rating Change #3

Plum Creek Timber Co 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 and notable return on equity. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:
  • PCL's revenue growth has slightly outpaced the industry average of 18.0%. Since the same quarter one year prior, revenues rose by 21.1%. 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.
  • 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 Real Estate Investment Trusts (REITs) industry and the overall market, PLUM CREEK TIMBER CO INC's return on equity exceeds that of both the industry average and the S&P 500.
  • In its most recent trading session, PCL has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.
  • PLUM CREEK TIMBER CO INC's earnings per share declined by 21.7% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, PLUM CREEK TIMBER CO INC reported lower earnings of $1.19 versus $1.25 in the prior year. For the next year, the market is expecting a contraction of 6.7% in earnings ($1.11 versus $1.19).
  • 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 Real Estate Investment Trusts (REITs) industry average. The net income has decreased by 23.7% when compared to the same quarter one year ago, dropping from $38.00 million to $29.00 million.

Plum Creek Timber Company, Inc. is a publicly owned real estate investment trust (REIT). The trust owns and manages timberlands in the United States. Its products include lumber products, plywood, medium density fiberboard, and related by-products, such as wood chips. The company has a P/E ratio of 33.3, equal to the average real estate industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Plum Creek Timber has a market cap of $6.13 billion and is part of the financial sector and real estate industry. Shares are up 3.8% year to date as of the close of trading on Thursday.

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

Rating Change #2

Linn Energy LLC 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, notable return on equity, impressive record of earnings per share growth and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.

Highlights from the ratings report include:
  • LINE's very impressive revenue growth greatly exceeded the industry average of 11.9%. Since the same quarter one year prior, revenues leaped by 380.0%. Growth in the company's revenue appears to have helped boost 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 Oil, Gas & Consumable Fuels industry. The net income increased by 98.6% when compared to the same quarter one year prior, rising from -$446.68 million to -$6.20 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 Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, LINN ENERGY LLC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • LINN ENERGY LLC 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 year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, LINN ENERGY LLC turned its bottom line around by earning $2.21 versus -$0.71 in the prior year. For the next year, the market is expecting a contraction of 25.3% in earnings ($1.65 versus $2.21).
  • The gross profit margin for LINN ENERGY LLC is rather high; currently it is at 69.50%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, LINE's net profit margin of -1.80% significantly underperformed when compared to the industry average.

Linn Energy, LLC, an independent oil and natural gas company, engages in the acquisition and development of oil and gas properties. The company's properties are primarily located in the Mid-Continent, the Permian Basin, Michigan, California, and the Williston Basin in the United States. The company has a P/E ratio of 7.1, below the average energy industry P/E ratio of 7.6 and below the S&P 500 P/E ratio of 17.7. Linn Energy has a market cap of $7.39 billion and is part of the basic materials sector and energy industry. Shares are down 2.2% year to date as of the close of trading on Friday.

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

Rating Change #1

Clorox Company 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, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • CLX's revenue growth has slightly outpaced the industry average of 0.1%. Since the same quarter one year prior, revenues slightly increased by 7.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.40 is very low and demonstrates very weak liquidity.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. 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.
  • 45.50% is the gross profit margin for CLOROX CO/DE which we consider to be strong. Regardless of CLX'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 9.40% trails the industry average.
  • CLOROX CO/DE reported flat earnings per share in the most recent quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, CLOROX CO/DE reported lower earnings of $2.09 versus $3.70 in the prior year. This year, the market expects an improvement in earnings ($4.05 versus $2.09).

The Clorox Company manufactures and markets consumer and institutional products worldwide. The company operates in four segments: Cleaning, Lifestyle, Household, and International. The company has a P/E ratio of 17.7, equal to the average consumer durables industry P/E ratio and equal to the S&P 500 P/E ratio of 17.7. Clorox has a market cap of $9.25 billion and is part of the consumer goods sector and consumer durables industry. Shares are up 6.9% year to date as of the close of trading on Tuesday.

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

-- Reported by Kevin Baker in Palm Beach Gardens, 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: BHI CLX CYH DRC EPR GEF LEN LINE PCL RIMM