Administaff, Comcast: Ratings Changes

BOSTON (TheStreet) -- TheStreet.com's stock-rating model upgraded human-resources consultant Administaff(ASF Quote) to "buy."

The numbers: Second-quarter net income decreased 51% to $5.4 million and earnings per share fell 49% to 22 cents. Revenue declined 4% to $404 million. Its gross margin fell from 20% to 18% and its operating margin decreased from 4% to 2%. A quick ratio of 1.3 reflects adequate liquidity. The company holds minimal debt.

The stock: Administaff is up 23% this year, more than the Dow Jones Industrial Average and S&P 500 Index. The stock trades at a price-to-earnings ratio of 19, a discount to the market and human resource peers. Shares pay a 2% dividend yield.

The model downgraded cable-TV provider Comcast(CMCSK Quote) to "hold."

The numbers: Second-quarter net income jumped 53% to $967 million and earnings per share climbed 57% to 33 cents, boosted by a lower share count. Revenue increased 5% to $8.9 billion. Its gross margin remained steady at 58% and its operating margin was unchanged at 21%. A quick ratio of 0.5 indicates weak liquidity. A debt-to-equity ratio of 0.8 is higher than the industry average, indicating excessive debt.

The stock: Comcast is down 10% this year, lagging behind major U.S. indices. The stock trades at a price-to-earnings ratio of 15, a discount to the market and cable and satellite peers. Shares pay a 1.9% dividend yield.

The model upgraded Lexmark(LXK Quote), maker of printers and ink cartridges, to "hold."

The numbers: Second-quarter net income fell 80% to $17 million and earnings per share dropped 75% to 22 cents, cushioned by a lower share count. Revenue fell 21% to $905 million. Its gross margin decreased from 41% to 40% and its operating margin descended from 10% to 7%. The company has a stable financial position, with $810 million of cash, compared to $649 million of debt.