3 Stocks Reiterated As A Hold: PCYC, OXY, AAL
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 hold 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:
Pharmacyclics Inc:
(Nasdaq:
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C. According to TheStreet Ratings team: The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, disappointing return on equity and poor profit margins.
Highlights from the ratings report include:
- PCYC's very impressive revenue growth greatly exceeded the industry average of 36.4%. Since the same quarter one year prior, revenues leaped by 134.9%. 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.
- PCYC has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.88, which clearly demonstrates the ability to cover short-term cash needs.
- Compared to its closing price of one year ago, PCYC's share price has jumped by 48.99%, exceeding the performance of the broader market during that same time frame. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- 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. In comparison to the other companies in the Biotechnology industry and the overall market, PHARMACYCLICS INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The gross profit margin for PHARMACYCLICS INC is currently lower than what is desirable, coming in at 32.46%. It has decreased significantly from the same period last year. Along with this, the net profit margin of 21.87% significantly trails the industry average.
- You can view the full analysis from the report here: Pharmacyclics Ratings Report
Pharmacyclics, Inc., a biopharmaceutical company, designs, develops, and commercializes small-molecule drugs for the treatment of cancer and immune mediated diseases in the United States and internationally. Pharmacyclics has a market cap of $16.4 billion and is part of the health care sector and drugs industry. Shares are up 81% year-to-date as of the close of trading on Monday.
Occidental Petroleum Corp:
(NYSE:
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+. According to TheStreet Ratings team:
Highlights from the ratings report include:
- OXY, with its decline in revenue, underperformed when compared the industry average of 20.1%. Since the same quarter one year prior, revenues fell by 30.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- OCCIDENTAL PETROLEUM CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, OCCIDENTAL PETROLEUM CORP reported lower earnings of $0.68 versus $7.35 in the prior year. This year, the market expects an improvement in earnings ($1.56 versus $0.68).
- 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 307.7% when compared to the same quarter one year ago, falling from $1,643.00 million to -$3,413.00 million.
- The share price of OCCIDENTAL PETROLEUM CORP has not done very well: it is down 11.75% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- You can view the full analysis from the report here: Occidental Ratings Report
Occidental Petroleum Corporation engages in the acquisition, exploration, and development of oil and gas properties in the United States and internationally. The company operates in three segments: Oil and Gas; Chemical; and Midstream, Marketing and Other. Occidental has a market cap of $60.0 billion and is part of the basic materials sector and energy industry. Shares are down 3.6% year-to-date as of the close of trading on Monday.
American Airlines Group Inc:
(Nasdaq:
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C. According to TheStreet Ratings team: The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and solid stock price performance. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.
Highlights from the ratings report include:
- Compared to other companies in the Airlines industry and the overall market, AMERICAN AIRLINES GROUP INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The revenue growth came in higher than the industry average of 22.3%. Since the same quarter one year prior, revenues rose by 38.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 109.46% and other important driving factors, this stock has surged by 34.28% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Airlines industry. The net income increased by 129.8% when compared to the same quarter one year prior, rising from -$2,001.00 million to $597.00 million.
- The debt-to-equity ratio is very high at 8.87 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, AAL maintains a poor quick ratio of 0.73, which illustrates the inability to avoid short-term cash problems.
- You can view the full analysis from the report here: American Airlines Group Ratings Report
American Airlines Group Inc., through its subsidiaries, operates in the airline industry. American Airlines Group has a market cap of $33.4 billion and is part of the services sector and transportation industry. Shares are down 9.9% year-to-date as of the close of trading on Monday.
null