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, June 5.
We've upgraded AmerisourceBergen (ABC) from hold to buy, driven by its growth in earnings per share, increase in net income, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins.
Earnings per share improved by 17.3% in the most recent quarter compared with the same quarter last year, and we feel that the company's two-year trend of EPS growth should continue. Net income increased by 7.1% compared with the year-ago quarter, from $133.9 million to $143.4 million. Net operating cash flow increased by 74.2% to $336.8 million, exceeding the industry average cash flow growth rate of 53.4%. AmerisourceBergen's debt-to-equity ratio of 0.4 is below the industry average, though the quick ratio of 0.5 implies a potential problem covering short-term cash needs. Return on equity improved compared with the year-ago quarter.We've downgraded Gushan Environmental Energy (GU) from hold to sell, driven by its unimpressive growth in net income, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share. Net income fell to -$340,000 from $15.9 million compared with the year-ago quarter. Gushan's gross profit margin of 19% has decreased significantly from the year-ago quarter, and net profit margin of -0.8% trails the industry average. EPS declined from the year-ago quarter, and we fell the company is likely to report a decline in earnings in the coming year. Revenue fell by 15.9% since the year-ago quarter.
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