NEW YORK ( TheStreet Ratings) -- Every trading day TheStreet Ratings' stock model reviews the investment ratings on around 4,700 U.S. traded stocks for potential upgrades or downgrades based on the latest available financial results and trading activity.
TheStreet Ratings released rating changes on 104 U.S. common stocks for week ending February 3, 2012. 84 stocks were upgraded and 20 stocks were downgraded by our stock model.
Rating Change #10
PerkinElmer Inc (PKI) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.Highlights from the ratings report include:
- PKI's revenue growth has slightly outpaced the industry average of 7.4%. Since the same quarter one year prior, revenues rose by 14.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has significantly increased by 185.33% to $82.53 million when compared to the same quarter last year. In addition, PERKINELMER INC has also vastly surpassed the industry average cash flow growth rate of 12.37%.
- The current debt-to-equity ratio, 0.51, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.92 is somewhat weak and could be cause for future problems.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Life Sciences Tools & Services industry. The net income has significantly decreased by 129.3% when compared to the same quarter one year ago, falling from $288.49 million to -$84.64 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Life Sciences Tools & Services industry and the overall market, PERKINELMER INC's return on equity significantly trails that of both the industry average and the S&P 500.