TSC Ratings' Updates: Foster Wheeler

Net operating cash flow has decreased to $130.42 million, or 17.62% when compared with the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower. Shares are down by 68.64% on the year, which is also worse that the performance of the S&P 500. Naturally, the overall market trend is bound to be a significant factor and the stock's sharp decline last year could be 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.

We've downgraded Time Warner Cable(TWC Quote), which provides video, data and voice service to residential and commercial customers in the U.S., from hold to sell, driven by its generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

The company reported flat earnings per share in the most recent quarter. For the next year, the market is expecting a contraction of 0.9% in earnings to $1.13. Time Warner Cable's gross profit margin is rather high at 53.10%, but it has managed to decrease from the same period last year. Net profit margin of 6.40% trails the industry average. The company's debt-to-equity ratio of 0.66 is somewhat low overall, but it is high when compared with the industry average, implying that the management of the debt levels should be evaluated further. The company's quick ratio of 1.79 is high and demonstrates strong liquidity. The company's return on equity is below that of both the industry average and the S&P 500.