TSC Ratings' Updates: BancorpSouth

BIOS had been rated a sell since June 19, 2008.

Brooks Automation(BRKS Quote) was downgraded from hold to sell. Brooks Automation supplies a range of technology products and solutions to the semiconductor market. The company operates in three segments: automation systems group, critical components group and global customer support group. The downgrade is based on the company's shrinking revenue, deteriorating margins and reduced bottom-line. Additionally, the company reported a decline in shareholders' equity and negative returns on assets and equity. However, increasing revenue from the global customer support segment and any improvement in the semiconductor manufacturing equipment market may be the upsides to the sell rating.

Brooks Automation's third quarter fiscal year 2008 revenue slipped 34.9% to $124.02 million from $190.46 million, due to weak demand for its products and services from the large original equipment manufacturers. Segment-wise, revenue from the automation systems segment decreased 46.1% to $58.87 million, while revenue from critical components dropped 42.4% to $28.34 million.

Brooks' gross profit margin declined 399 basis points to 30.39% from 34.38%, hurt by an unfavorable product mix and declining revenue. Similarly, operating margin deteriorated to - 6.81% from a positive 7.72% a year ago. Subsequently, the company swung to net loss of $10.33 million or 17 cents per share from net profit of $22.84 million or 30 cents per share in the third quarter of fiscal year 2007.

During the third quarter of fiscal year 2008, the company's cash position dwindled as reflected by a 60.0% decline in cash and cash equivalents to $144.20 million. Furthermore, both return on assets and equity slipped into the negative territory standing at -2.40% and -2.84% compared with 15.14% and 6.88%, respectively. Moreover, shareholders' equity dipped 20.9% to $763.75 million from $965.57 million in the prior-year's quarter.