TSC Ratings' Updates: Fluor

Aqua America has improved earnings per share by 18.2% in the most recent quarter compared with the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years, which we feel should continue. During the past fiscal year, it increased its bottom line by earning 72 cents vs. 70 cents in the prior year. This year, the market expects an improvement in earnings to 74 cents.

Revenue increased 7% since the same quarter a year ago, significantly trailing the industry average of 46.8%. Aqua America's gross profit margin for is rather high at 55%, having increased from the same quarter the previous year. The net profit margin of 20% trails the industry average. Net operating cash flow has slightly increased to $78.10 million, or 8.1% when compared with the same quarter last year, but Aqua America's cash flow growth rate is still lower than the industry average growth rate of 33.41%. On the basis of net income growth from the same quarter one year ago, the company has significantly underperformed the water utilities industry average but has outperformed the S&P 500. Net income increased by 19.9% when compared with the same quarter one year prior, going from $29.52 million to $35.38 million.

We've downgraded Wolverine World Wide(WWW Quote), which engages in manufacturing, sourcing, marketing, licensing and distributing footwear, apparel, and accessories to the retail sector, from buy to hold. Strengths include its growth in earnings per share, increase in net income and revenue growth. However, as a counter to these strengths, we find that the stock has had a decline in price during the past year.