Tyco Int’l (TYC) Stock Lower Ahead of Earnings Results
NEW YORK (TheStreet) --Shares of Tyco International (TYC) are slipping by 0.59% to $37.12 at the start of trading on Thursday morning, one day prior to the release of the fire protection and security company's 2015 fourth quarter earnings results.
The Cork, Ireland-based company will release its latest financial results before the market open on Friday morning.
Analysts are expecting Tyco to post a year over year rise in its earnings per share results, however, revenue for the most recent quarter is expected to decline slightly.
The company has been forecast to report earnings of 61 cents per share on revenue of $2.55 billion for the three month period ended in September.
Tyco's earnings from continuing operations before special items came in at 56 cents per diluted share for the 2014 fourth quarter. Revenue was $2.7 billion for the year ago period.
Separately, TheStreet Ratings team rates TYCO INTERNATIONAL PLC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
We rate TYCO INTERNATIONAL PLC (TYC) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has increased to $245.00 million or 38.41% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 2.37%.
- The current debt-to-equity ratio, 0.47, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that TYC's debt-to-equity ratio is low, the quick ratio, which is currently 0.69, displays a potential problem in covering short-term cash needs.
- 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 Commercial Services & Supplies industry. The net income has significantly decreased by 89.2% when compared to the same quarter one year ago, falling from $1,450.00 million to $156.00 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Commercial Services & Supplies industry and the overall market, TYCO INTERNATIONAL PLC'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: TYC
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.