3 Stocks Reiterated As A Buy: HOT, DFS, UTX
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
NEW YORK (TheStreet) -- TheStreet Ratings team reiterated 3 stocks with a buy rating on Tuesday based on 32 different data factors including general market action, fundamental analysis and technical indicators. The in-depth analysis of these ratings decisions goes as follows:
Starwood Hotels & Resorts Worldwide Inc:
Starwood Hotels & Resorts Worldwide
(NYSE:
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B. According to TheStreet Ratings team: The company's strengths can be seen in multiple areas, such as its increase in net income, notable return on equity, reasonable valuation levels and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 82.8% when compared to the same quarter one year prior, rising from $128.00 million to $234.00 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, STARWOOD HOTELS&RESORTS WRLD's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.7%. Since the same quarter one year prior, revenues slightly dropped by 0.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- STARWOOD HOTELS&RESORTS WRLD reported significant earnings per share improvement 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, STARWOOD HOTELS&RESORTS WRLD increased its bottom line by earning $3.50 versus $2.92 in the prior year. For the next year, the market is expecting a contraction of 16.0% in earnings ($2.94 versus $3.50).
- You can view the full analysis from the report here: Starwood Hotels & Resorts Worldwide Ratings Report
Starwood Hotels & Resorts Worldwide, Inc. operates as a hotel and leisure company worldwide. Starwood Hotels & Resorts Worldwide has a market cap of $13.8 billion and is part of the services sector and leisure industry. Shares are up 2.2% year-to-date as of the close of trading on Monday.
Discover Financial Services:
(NYSE:
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B-. According to TheStreet Ratings team: The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.4%. Since the same quarter one year prior, revenues slightly dropped by 2.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- DISCOVER FINANCIAL SVCS INC's earnings per share declined by 29.3% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, DISCOVER FINANCIAL SVCS INC reported lower earnings of $4.90 versus $4.96 in the prior year. This year, the market expects an improvement in earnings ($5.36 versus $4.90).
- 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. Compared to other companies in the Consumer Finance industry and the overall market on the basis of return on equity, DISCOVER FINANCIAL SVCS INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- You can view the full analysis from the report here: Discover Financial Services Ratings Report
Discover Financial Services, a bank holding company, provides a range of financial products and services in the United States. The company operates in two segments, Direct Banking and Payment Services. Discover Financial Services has a market cap of $27.3 billion and is part of the financial sector and financial services industry. Shares are down 8% year-to-date as of the close of trading on Monday.
United Technologies Corp:
(NYSE:
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A. According to TheStreet Ratings team: The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, largely solid financial position with reasonable debt levels by most measures, notable return on equity and increase in stock price during the past year. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- UTX's revenue growth has slightly outpaced the industry average of 0.5%. Since the same quarter one year prior, revenues slightly increased by 1.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- UNITED TECHNOLOGIES CORP's earnings per share improvement from the most recent quarter was slightly positive. 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, UNITED TECHNOLOGIES CORP increased its bottom line by earning $6.82 versus $6.22 in the prior year. This year, the market expects an improvement in earnings ($7.00 versus $6.82).
- The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The debt-to-equity ratio is somewhat low, currently at 0.63, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.72 is somewhat weak and could be cause for future problems.
- 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 Aerospace & Defense industry and the overall market on the basis of return on equity, UNITED TECHNOLOGIES CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- You can view the full analysis from the report here: United Ratings Report
United Technologies Corporation provides technology products and services to building systems and aerospace industries worldwide. United has a market cap of $110.6 billion and is part of the industrial goods sector and aerospace/defense industry. Shares are up 7.1% year-to-date as of the close of trading on Monday.
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