AMD, Capital One, Xerox: Ratings Changes

Advanced Micro Devices, Capital One, Fifth Third and Xerox had their ratings changed by TheStreet.
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BOSTON (

TheStreet

) -- TheStreet.com's stock-rating model upgraded chipmaker

Advanced Micro Devices

(AMD) - Get Report

to "hold."

The numbers

: AMD swung to a fourth-quarter profit of $1.2 billion, or $1.49 a share, from a loss of $1.4 billion, or $2.34 a share, in the year-earlier period. Revenue increased 42% to $1.6 billion. AMD's operating margin climbed from negative territory to 3%. The company has adequate liquidity, with a quick ratio of 1.6. Its 7.3 debt-to-equity ratio indicates excessive leverage.

The stock

: AMD shares have almost quadrupled during the past year, outpacing major U.S. indices. The stock trades at a price-to-earnings ratio of 56, a premium to semiconductor peers. AMD doesn't pay dividends.

The model upgraded custody bank

Bank of New York Mellon

(BK) - Get Report

to "hold."

The numbers

: Fourth-quarter net income rose ninefold to $593 million, or 59 cents a share. Revenue inched up 2% to $3.4 billion. Bank of New York's operating margin jumped from 37% to 53%. The company has an outstanding liquidity position, with $71 billion of cash and marketable securities and $21 billion of debt. A debt-to-equity ratio of 0.7 indicates moderate leverage.

The stock

: Bank of New York Mellon has increased 25% during the past year, trailing major U.S. indices. The stock trades at a forward price-to-earnings ratio of 10, a discount to diversified financial service peers. The shares offer a 1.2% dividend yield.

The model upgraded consumer finance company

Capital One Financial

(COF) - Get Report

to "hold."

The numbers

: Capital One swung to a fourth-quarter profit of $376 million, or 89 cents a share, from a loss of $1.4 billion, or $3.67 a share, in the year-earlier period. Revenue declined 3% to $4 billion. The company's operating margin climbed from negative territory to 21%. Capital One has adequate liquidity, with $8.7 billion of cash. Its debt-to-equity ratio of 0.8 is less than the industry average, indicating conservative leverage.

The stock

: Capital One has advanced 87% during the past year, beating major U.S. indices. The stock trades at a price-to-earnings ratio of 45, a premium to consumer finance peers. The shares offer a 0.6% dividend yield.

The model upgraded regional bank

Fifth Third Bancorp

(FITB) - Get Report

to "hold."

The numbers

: The company's fourth-quarter loss narrowed to $98 million, or 20 cents a share, as revenue decreased 14% to $1.8 billion. Fifth Third's operating margin climbed from negative territory to 14%. The company holds $6 billion of cash and marketable securities and $12 billion of debt. Its debt-to-equity ratio of 0.9 indicates reasonable leverage.

The stock

: Fifth Third shares have quadrupled during the past year, more than major U.S. indices. The stock trades at a price-to-earnings ratio of 17, a discount to regional bank peers. The shares offer a 0.3% dividend yield.

The model upgraded

Xerox

(XRX) - Get Report

to "buy."

The numbers

: Fourth-quarter profit surged to $180 million, or 20 cents a share, from $1 million in the year-earlier period. The company's net margin went from just above zero to 4%. Xerox has adequate liquidity, evident in its quick ratio of 1.8. Its debt-to-equity ratio of 1.4 indicates higher-than-ideal leverage.

The stock

: Xerox has climbed 28% during the past year, outpacing the

Dow Jones Industrial Average

, but trailing the

S&P 500 Index

. The shares offer a 1.9% dividend yield.

-- Reported by Jake Lynch in Boston.