TSC Ratings' Updates: Macy's

TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

The following ratings changes were generated on Friday, April 3.

We've downgraded AngioDynamics(ANGO Quote), which designs, develops, manufactures and markets various therapeutic and diagnostic devices that enable physicians to treat peripheral vascular disease, tumors and other noncoronary diseases, from hold to sell. This rating is driven by the company's deteriorating net income, disappointing return on equity and weak operating cash flow.

Net income decreased by 60.9% compared with the year-ago quarter, from $4.9 million to $1.9 million. Return on equity also decreased. Net operating cash flow fell 29.5% to $6.9 million. Gross profit margin of 62.6% has managed to decreased from the same period last year. Net profit margin od 3.9% is below what it was in the year-ago quarter.

We feel that the combination of AngioDynamics' price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.

We've downgraded department store operator Macy's(M Quote) from hold to sell, driven by its deteriorating net income, generally weak debt management, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Net income fell to -$4.8 billion from $750 million in the year-ago quarter. The debt-to-equity ratio of 2.1 is above the industry average. The quick ratio or 0.3 implies difficulty covering short-term cash needs. ROE has decreased from the same quarter a year ago. Net operating cash flow fell 19.7% to $1.6 billion compared with the year-ago quarter.