TheStreet Ratings Top 10 Rating Changes

Tickers in this article: ALLT BSFT EEP JOY MNRO NVDA SNDK TRNO TXI WIRE

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 40 U.S. common stocks for week ending July 13, 2012. 24 stocks were upgraded and 16 stocks were downgraded by our stock model.

Rating Change #10

SanDisk Corp 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, reasonable valuation levels and expanding profit margins. 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 disappointing return on equity.

Highlights from the ratings report include:

  • Although SNDK's debt-to-equity ratio of 0.23 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 3.51, which clearly demonstrates the ability to cover short-term cash needs.
  • 38.40% is the gross profit margin for SANDISK CORP which we consider to be strong. Regardless of SNDK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SNDK's net profit margin of 9.50% is significantly lower than the same period one year prior.
  • 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. In comparison to the other companies in the Computers & Peripherals industry and the overall market, SANDISK CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • Net operating cash flow has significantly decreased to $67.17 million or 83.14% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

Sandisk Corporation designs, develops, and manufactures NAND flash memory storage solutions that are used in various consumer electronics products. The company has a P/E ratio of 9.7, equal to the average computer hardware industry P/E ratio and below the S&P 500 P/E ratio of 17.7. SanDisk has a market cap of $8.44 billion and is part of the technology sector and computer hardware industry. Shares are down 29.6% year to date as of the close of trading on Thursday.

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

Rating Change #9

NVIDIA Corporation 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 unimpressive growth in net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • NVDA's debt-to-equity ratio is very low at 0.00 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 3.74, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for NVIDIA CORP is rather high; currently it is at 50.10%. Regardless of NVDA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NVDA's net profit margin of 6.50% is significantly lower than the same period one year prior.
  • 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 Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 55.3% when compared to the same quarter one year ago, falling from $135.22 million to $60.44 million.
  • Net operating cash flow has significantly decreased to -$9.21 million or 105.34% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

NVIDIA Corporation provides graphics chips for use in smartphones, personal computers (PC), tablets, and professional workstations markets worldwide. It operates in three segments: Graphic Processing Unit (GPU), Professional Solutions Business (PSB), and Consumer Products Business (CPB). The company has a P/E ratio of 15.4, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17.7. NVIDIA has a market cap of $7.8 billion and is part of the technology sector and electronics industry. Shares are down 9% year to date as of the close of trading on Friday.

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

Rating Change #8

Joy Global 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, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 16.4%. Since the same quarter one year prior, revenues rose by 45.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • JOY GLOBAL INC has improved earnings per share by 34.2% 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. This trend suggests that the performance of the business is improving. During the past fiscal year, JOY GLOBAL INC increased its bottom line by earning $5.92 versus $4.40 in the prior year. This year, the market expects an improvement in earnings ($7.25 versus $5.92).
  • The debt-to-equity ratio is somewhat low, currently at 0.70, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.80 is somewhat weak and could be cause for future problems.
  • Net operating cash flow has significantly decreased to $104.80 million or 59.19% when compared to the same quarter last year. Despite a decrease in cash flow of 59.19%, JOY GLOBAL INC is in line with the industry average cash flow growth rate of -68.43%.
  • JOY's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 47.66%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.

Joy Global Inc. engages in the manufacture and servicing of mining equipment for the extraction of coal, copper, iron ore, oil sands, and other minerals. The company operates in two segments, Underground Mining Machinery and Surface Mining Equipment. The company has a P/E ratio of 7.4, below the average industrial industry P/E ratio of 7.7 and below the S&P 500 P/E ratio of 17.7. Joy Global has a market cap of $5.35 billion and is part of the industrial goods sector and industrial industry. Shares are down 32.5% year to date as of the close of trading on Thursday.

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

Rating Change #7

Allot Communications Ltd 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 impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 6.0%. Since the same quarter one year prior, revenues rose by 40.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • ALLT 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 this, the company maintains a quick ratio of 5.51, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for ALLOT COMMUNICATIONS LTD is currently very high, coming in at 74.30%. Regardless of ALLT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ALLT's net profit margin of 13.40% is significantly lower than the same period one year prior.
  • Powered by its strong earnings growth of 66.66% and other important driving factors, this stock has surged by 29.04% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.
  • 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. In comparison to the other companies in the Software industry and the overall market, ALLOT COMMUNICATIONS LTD's return on equity is significantly below that of the industry average and is below that of the S&P 500.

Allot Communications Ltd. engages in developing, selling, and marketing Internet protocol service optimization and revenue generation solutions in Europe, the Middle East, Africa, the Americas, Asia, and Oceania. The company has a P/E ratio of 68.8, equal to the average computer software & services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Allot has a market cap of $718.3 million and is part of the technology sector and computer software & services industry. Shares are up 49.3% year to date as of the close of trading on Friday.

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

Rating Change #6

BroadSoft Inc has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:

  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 38.86%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 53.84% compared to the year-earlier quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, BSFT is still more expensive than most of the other companies in its industry.
  • 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 Software industry. The net income has significantly decreased by 54.0% when compared to the same quarter one year ago, falling from $3.70 million to $1.70 million.
  • Net operating cash flow has significantly decreased to -$3.45 million or 211.20% 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's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Software industry and the overall market, BROADSOFT INC's return on equity exceeds that of both the industry average and the S&P 500.

BroadSoft, Inc. provides software and services that enable mobile, fixed-line, and cable service providers to deliver unified communications and other voice and multimedia services over Internet protocol (IP) based networks. The company has a P/E ratio of 23.5, equal to the average computer software & services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. BroadSoft has a market cap of $702 million and is part of the technology sector and computer software & services industry. Shares are down 15.9% year to date as of the close of trading on Thursday.

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

Rating Change #5

Enbridge Energy Partners LP has been upgraded by TheStreet Ratings from hold to buy. Among the primary strengths of the company is its respectable return on equity which we feel is likely to continue. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • 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, ENBRIDGE ENERGY PRTNRS -LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • The revenue fell significantly faster than the industry average of 11.9%. Since the same quarter one year prior, revenues fell by 20.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • ENBRIDGE ENERGY PRTNRS -LP's earnings per share declined by 34.2% in the most recent quarter compared to 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, ENBRIDGE ENERGY PRTNRS -LP turned its bottom line around by earning $1.89 versus -$1.08 in the prior year. For the next year, the market is expecting a contraction of 30.7% in earnings ($1.31 versus $1.89).
  • The gross profit margin for ENBRIDGE ENERGY PRTNRS -LP is currently lower than what is desirable, coming in at 26.50%. Regardless of EEP'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 5.40% trails the industry average.
  • After a year of stock price fluctuations, the net result is that EEP's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Despite the stock's decline during the last year, it is still somewhat more expensive (in proportion to its earnings over the last year) than most other stocks in its industry. We feel, however, that other strengths this company displays offset this slight negative.

Enbridge Energy Partners, L.P. owns and operates crude oil and liquid petroleum transportation and storage assets, as well as natural gas gathering, treating, processing, transmission, and marketing assets in the United States. The company has a P/E ratio of 16.2, equal to the average energy industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Enbridge Energy has a market cap of $7.18 billion and is part of the basic materials sector and energy industry. Shares are down 9.1% year to date as of the close of trading on Tuesday.

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

Rating Change #4

Texas Industries Inc has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Construction Materials industry. The net income increased by 762.7% when compared to the same quarter one year prior, rising from -$9.09 million to $60.21 million.
  • Net operating cash flow has significantly increased by 674.97% to $8.05 million when compared to the same quarter last year. In addition, TEXAS INDUSTRIES INC has also vastly surpassed the industry average cash flow growth rate of 104.23%.
  • Despite the weak revenue results, TXI has outperformed against the industry average of 15.0%. Since the same quarter one year prior, revenues slightly dropped by 0.7%. The declining revenue has not hurt the company's bottom line, with increasing 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 Construction Materials industry and the overall market, TEXAS INDUSTRIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • TXI has underperformed the S&P 500 Index, declining 6.03% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

Texas Industries, Inc., together with its subsidiaries, engages in the manufacture and sale of heavy construction materials in the southwestern United States. It operates in three segments: Cement, Aggregates, and Consumer Products. Texas has a market cap of $1.1 billion and is part of the industrial goods sector and materials & construction industry. Shares are up 28.2% year to date as of the close of trading on Thursday.

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

Rating Change #3

Monro Muffler/Brake 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, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • MNRO's revenue growth has slightly outpaced the industry average of 8.0%. Since the same quarter one year prior, revenues rose by 13.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • MONRO MUFFLER BRAKE INC has improved earnings per share by 23.1% 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, MONRO MUFFLER BRAKE INC increased its bottom line by earning $1.69 versus $1.45 in the prior year. This year, the market expects an improvement in earnings ($1.76 versus $1.69).
  • 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 Specialty Retail industry average. The net income increased by 27.3% when compared to the same quarter one year prior, rising from $8.25 million to $10.50 million.
  • Net operating cash flow has slightly increased to $11.58 million or 7.39% when compared to the same quarter last year. In addition, MONRO MUFFLER BRAKE INC has also modestly surpassed the industry average cash flow growth rate of 1.43%.
  • Although MNRO's debt-to-equity ratio of 0.17 is very low, it is currently higher than that of the industry average. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.16 is very weak and demonstrates a lack of ability to pay short-term obligations.

Monro Muffler Brake, Inc. provides automotive undercar repair and tire services in the United States. The company offers a range of services on passenger cars, light trucks, and vans for brakes; mufflers and exhaust systems; and steering, drive train, suspension, and wheel alignment. The company has a P/E ratio of 21.1, equal to the average automotive industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Monro Muffler/Brake has a market cap of $1.1 billion and is part of the consumer goods sector and automotive industry. Shares are down 8.3% year to date as of the close of trading on Friday.

You can view the full Monro Muffler/Brake Ratings Report or get investment ideas from our investment research center.

Rating Change #2

Encore Wire Corporation has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • WIRE 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 this, the company maintains a quick ratio of 7.44, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has increased to -$18.85 million or 25.70% when compared to the same quarter last year. In addition, ENCORE WIRE CORP has also vastly surpassed the industry average cash flow growth rate of -24.56%.
  • 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, despite the company's weak earnings results. 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.
  • WIRE, with its decline in revenue, slightly underperformed the industry average of 2.7%. Since the same quarter one year prior, revenues slightly dropped by 7.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

Encore Wire Corporation manufactures and supplies electrical building wires and cables for use in interior electrical wiring applications in commercial and industrial buildings, homes, apartments, and manufactured housings. The company has a P/E ratio of 14.2, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Encore Wire has a market cap of $656.9 million and is part of the technology sector and electronics industry. Shares are up 8.3% year to date as of the close of trading on Tuesday.

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

Rating Change #1

Terreno Realty Corporation has been upgraded by TheStreet Ratings from sell 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 impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • TRNO's very impressive revenue growth greatly exceeded the industry average of 18.0%. Since the same quarter one year prior, revenues leaped by 95.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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.
  • Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, TERRENO REALTY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • TRNO has underperformed the S&P 500 Index, declining 7.95% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The gross profit margin for TERRENO REALTY CORP is currently extremely low, coming in at 11.70%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, TRNO's net profit margin of -4.00% significantly underperformed when compared to the industry average.

Terreno Realty Corporation engages in acquiring, owning, and operating real estate properties in Los Angeles area, northern New Jersey/New York City, San Francisco Bay area, Seattle area, Miami area, and Washington D.C./Baltimore area. Terreno has a market cap of $205.5 million and is part of the financial sector and real estate industry. Shares are up 1.4% year to date as of the close of trading on Thursday.

You can view the full Terreno 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: ALLT BSFT EEP JOY MNRO NVDA SNDK TRNO TXI WIRE