Note: Our quantitative model makes stock recommendations based on GAAP figures that may differ materially from data as reported by the companies themselves. As a result, rating changes are occasionally driven by so-called nonrecurring items. As always, we urge readers to use TSC Ratings' reports in conjunction with additional information to construct their opinions on the value that should be placed on any given stock.
The following ratings changes were generated on Thursday, March 26.
We've downgraded Capital City Bank Group (CCBG), which operates as the holding company for Capital City Bank, offering commercial and retail banking services in Florida, Georgia and Alabama, from hold to sell. This rating is driven by the company's generally disappointing historical performance in the stock itself, feeble growth in its earnings per share, disappointing return on equity and weak operating cash flow.
Capital City experienced a decline in earnings per share in the most recent quarter compared with the same quarter last year, and we anticipate its two-year trend of declining EPS to continue in the coming year. The company's return on equity also decreased. Net operating cash flow fell to -$3.6 million in the most recent quarter. Net income decreased from $7.7 million to -$1.7 million.Shares have tumbled by 57.1% over the past year, underperforming the S&P 500, but based on its current price in relation to its earnings, Capital City is still more expensive than most of the other companies in its industry. We've upgraded independent investment banking company Greenhill (GHL) from hold to buy, driven by its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. The 0.1 deb-to-equity ratio is below the industry average, implying successful management of debt levels. The 1.4 quick ratio implies an ability to avoid short-term cash problems. The 40.8% gross profit margin is strong, though it has decreased from the same period last year. Revenue fell 45.6% since the year-ago quarter, and EPS declined in the most recent quarter compared with the year-ago quarter. However, we anticipate that the company's two-year pattern of declining EPS should reverse in the coming year. Net income fell by 56% compared with the year-ago quarter, from $28.5 million to $12. 5 million.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV