NEW YORK (TheStreet) -- Rotating machinery specialist Dresser-Rand Group (DRC) was downgraded to "equal-weight" by Morgan Stanley with a $57 price target on Wednesday. The investment firm said slower infrastructure spending would hurt profits.
The Olean, NY-based business was tumbling on Tuesday after announcing plans to suspend operations at a plant in Spain due to proposed government regulation. Management also lowered its 2013 guidance.
The stock closed nearly 8% lower on Tuesday to $54.10.
- DRESSER-RAND GROUP INC has improved earnings per share by 18.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, DRESSER-RAND GROUP INC increased its bottom line by earning $2.35 versus $1.56 in the prior year. This year, the market expects an improvement in earnings ($3.19 versus $2.35).
- Despite its growing revenue, the company underperformed as compared with the industry average of 8.2%. Since the same quarter one year prior, revenues slightly increased by 6.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Energy Equipment & Services industry average. The net income increased by 19.9% when compared to the same quarter one year prior, going from $41.20 million to $49.40 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Energy Equipment & Services industry and the overall market on the basis of return on equity, DRESSER-RAND GROUP INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- The gross profit margin for DRESSER-RAND GROUP INC is currently lower than what is desirable, coming in at 32.18%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 7.79% trails that of the industry average.
- You can view the full analysis from the report here: DRC Ratings Report
Select the service that is right for you!COMPARE ALL SERVICES
- $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
- 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 + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV