NEW YORK (TheStreet) -- Wesco (WCC - Get Report) has been downgraded to "neutral" from "overweight," JPMorgan said. The firm said consensus expectations are too high for both sales and margins. A $93 price target was set.
Separately, TheStreet Ratings team rates WESCO INTL INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:"We rate WESCO INTL INC (WCC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Despite its growing revenue, the company underperformed as compared with the industry average of 2.0%. Since the same quarter one year prior, revenues slightly increased by 0.1%. 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.
- Compared to its closing price of one year ago, WCC's share price has jumped by 29.82%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WCC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- WESCO INTL INC's earnings per share declined by 39.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WESCO INTL INC increased its bottom line by earning $5.26 versus $3.95 in the prior year. This year, the market expects an improvement in earnings ($5.50 versus $5.26).
- WCC's debt-to-equity ratio of 0.85 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.12 is sturdy.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Trading Companies & Distributors industry and the overall market, WESCO INTL INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: WCC Ratings Report