This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

TSC Ratings' Updates: Chipotle

We've upgraded temperature-sensitive truckload carrier Marten Transport (MRTN) from hold to buy, driven by its impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins.

EPS improved in the most recent quarter compared with the same quarter last year, and we feel that the company's year-long trend of EPS growth should continue. Net income rose 96.3%, from $3 million in the year-ago quarter to $5.8 million. Marten's debt-to-equity ratio of 0.02 is below the industry average. The 1.1 quick ratio implies the ability to avoid short-term cash problems. Revenue fell 3.1%, but EPS increased.

Shares rose over the past year, outperforming the S&P 500. The stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.

We've downgraded Schweitzer-Mauduit International (SWM), which manufactures and sells paper and reconstituted tobacco products to the tobacco industry, from hold to sell. This rating is driven by the company's decline in the stock price during the past year, disappointing return on equity, poor profit margins, weak operating cash flow and feeble growth in its earnings per share.

ROE decreased from the same quarter a year ago, implying a minor weakness. The company's gross profit margin is 21.9%, though it has increased from the year-ago period. Net operating cash flow fell 71.7% to $5.3 million compared with the year-ago quarter. EPS declined, though the consensus estimate suggests that the company's year-long pattern of declining EPS should reverse in the coming year.

Shares tumbled 12.4% over the past year, in par reflecting the market's overall decline. We do not see anything in this company's numbers that would change the one-year trend. It was down over the last 12 months; and it could be down again in the next 12. Naturally, a bull or bear market could sway the movement of this stock.

All ratings changes from April 6 are listed below.



Ticker
Company
Current
Change
Previous
ADVS
Advent Software
BUY
Upgrade
HOLD
AEHR
AEHR Test Systems
SELL
Downgrade
HOLD
CMG.B
Chipotle Mexican Grill
HOLD
Upgrade
SELL
LWSN
Lawson Software
HOLD
Upgrade
SELL
MRTN
Marten Transport
BUY
Upgrade
HOLD
SWM
Schweitzer-Mauduit
SELL
Downgrade
HOLD
XIN
Xinyuan Real Estate
HOLD
Upgrade
SELL
SOURCE:

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.

TheStreet.com Ratings, recently cited for Best Stock Selection from October 2007 through February 2009 , is an independent research provider that combines fundamental and technical analysis to offer investors tremendous value in volatile times. To see how your portfolio can use this research, click here now!

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,034.68 +55.55 0.33%
S&P 500 1,987.46 +0.95 0.05%
NASDAQ 4,514.2790 -12.2030 -0.27%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs