TSC Ratings' Updates: ArvinMeritor

DNN has experienced a steep decline in earnings per share in the most-recent quarter in comparison with its performance from the same quarter a year ago.

The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared with the S&P 500 and the oil, gas and consumable fuels industry. The net income has significantly decreased by 134.0% when compared with the same quarter one year ago, falling from $40.49 million to -$13.76 million.

The gross profit margin for DNN is currently lower than what is desirable, coming in at 32.20%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -43.40% is significantly below the industry average.

Compared with other companies in the oil, gas and consumable fuels industry and the overall market, DNN's return on equity significantly trails that of both the industry average and the S&P 500.

Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: It has tumbled by 31.42%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 133.33% compared with the year-earlier quarter.

Solera Holdings(SLH Quote) has been initiated at hold. Solera Holdings and its subsidiaries provide automobile insurance claims processing software and services to insurance companies, collision repair facilities, independent assessors and automotive recyclers.

The company's strengths can be seen in multiple areas, such as its solid stock price performance, robust revenue growth and growth in earnings per share. However, as a counter to these strengths, we find that the company has not been very careful in the management of its balance sheet.

Compared with its price level of one year ago, SLH is up 69.74% to its most recent closing price of $29.74. Looking ahead, our view is that this company's fundamentals should not have much impact in either direction, allowing the stock to generally move up or down on the basis of the push and pull of the broad market.

SLH's revenue growth has slightly outpaced the industry average of 16.2%. Since the same quarter one year prior, revenue rose by 18.8%. Growth in the company's revenue appears to have helped boost the earnings per share.

The gross profit margin for SLH is rather high; currently it is at 64.70%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -14.80% is in line with the industry average.

Compared with other companies in the software industry and the overall market, SLH's return on equity significantly trails both the industry average and that of the S&P 500.

The debt-to-equity ratio of 1.35 is relatively high when compared with the industry average, suggesting a need for better debt level management. Regardless of the company's weak debt-to-equity ratio, SLH has managed to keep a strong quick ratio of 1.64, which demonstrates the ability to cover short-term cash needs.

Additional ratings changes from August 29 are listed below.

Ticker	Company Name	Change	New Rating	Former Rating
ALCO	Alico Inc.	Upgrade	Hold	Sell
ARM	ArvinMeritor Inc.	Upgrade	Buy	Hold
BMTI	Biomimetic Therapeutics Inc.	Downgrade	Sell	Hold
CMFB	Commercefirst Bancorp Inc.	Upgrade	Hold	Sell
DNN	Denison Mines Corp.	Initiated	Sell
GAIN	Gladstone Investment Corp.	Initiated	Sell
LIVC	Live Current Media Inc.	Downgrade	Sell	Hold
SCIE	SpectraScience Inc.	Initiated	Sell
SLH	Solera Holdings Inc.	Initiated	Hold
SXI	Standex International Corp.	Upgrade	Buy	Hold
TIF	Tiffany & Co.	Downgrade	Hold	Buy
TIII	TII Network Technologies	Downgrade	Sell	Hold
TIVO	TiVo Inc.	Downgrade	Sell	Hold
TRMA	Trico Marine Services	Downgrade	Hold	Buy
WF	Woori Finance Holdings	Downgrade	Sell	Hold

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