Rating Change #1
UBS AG (UBS) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally poor debt management and disappointing return on equity.
Highlights from the ratings report include:
- 36.90% is the gross profit margin for UBS AG which we consider to be strong. Regardless of UBS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.50% trails the industry average.
- 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 Capital Markets industry. The net income has significantly decreased by 86.8% when compared to the same quarter one year ago, falling from $2,054.46 million to $271.65 million.
- The debt-to-equity ratio is very high at 6.20 and currently higher than the industry average, implying that there is very poor management of debt levels within the company.
UBS AG, a financial services firm, provides wealth management, asset management, and investment banking products and services to private, corporate, and institutional clients worldwide. The company also involves in retail and commercial banking in Switzerland. The company has a P/E ratio of 13.2, above the average banking industry P/E ratio of 8.2 and below the S&P 500 P/E ratio of 17.7. UBS has a market cap of $52.08 billion and is part of the financial sector and banking industry. Shares are up 20.6% year to date as of the close of trading on Wednesday.You can view the full UBS Ratings Report or get investment ideas from our investment research center. -- Reported by Kevin Baker in Jupiter, Fla.
For additional Investment Research check out our Ratings Research Center. For all other upgrades and downgrades made by TheStreet Ratings Model today check out our upgrades and downgrades list.
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