TSC Ratings' Updates: Tyson

We've downgraded Crown Castle International(CCI Quote), which engages in the ownership, operation, and leasing of towers and other communications structures, from hold to sell, driven by its generally weak debt management, poor profit margins and generally disappointing historical performance in the stock itself.

Crown Castle's debt-to-equity ratio of 1.76 is quite high overall and compared with the industry average, suggesting that the current management of debt levels should be re-evaluated. It also has a quick ratio of 0.60, which demonstrates the lack of ability of the company to cover short-term liquidity needs. Gross profit margin of 30.3% is lower than desirable, having decreased significantly from the same period last year. Along with this, the net profit margin of -8.40% is significantly below that of the industry average.

Net income increased by 51.9% from the same quarter a year ago, to -$32.21 million. ROE has improved slightly, which can be construed as a modest strength, but it significantly trails average ROE of the industry and the S&P 500. Shares are down 56.51% on the year, underperforming the S&P 500.

Naturally, the overall market trend is bound to be a significant factor, and 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.

We've downgraded Ryder System(R Quote), which provides transportation and supply chain management solutions, from buy to hold. Strengths include its growth in earnings per share, increase in net income and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses, including generally poor debt management and poor profit margins.