Each weekday, TheStreet.com Ratings updates its ratings on the stocks it covers. The proprietary ratings model projects a stock's total return potential over a 12-month period, including both price appreciation and dividends. Buy, hold or sell ratings designate how the Ratings group expects these stocks to perform against a general benchmark of the equities market and interest rates.
While the ratings model is quantitative, it uses both subjective and objective elements. For instance, subjective elements include expected equities market returns, future interest rates, implied industry outlook and company earnings forecasts. Objective elements include volatility of past operating revenue, financial strength and company cash flows.
provides cellular telecommunications services in Brazil. It has been upgraded to a hold from a sell. The company's net losses narrowed in the second quarter to $119.92 million from $228.21 million in the same period last year. Its revenue increased by 38.38% over the same timeframe. Vivo Participacoes' stock price has risen by 81.58% in the last 12 months, and TheStreet.com Ratings' hold rating indicates that additional investment is not recommended at this time. The company had been rated a sell since October 2005.
, through its subsidiaries, provides financial guarantee insurance and credit protection products. It has been downgraded to a hold from a buy. The company's revenue increased by 11.6% in the third quarter, but trailed the industry average growth rate of 13.2%. Its gross profit margin of 87.20% is very high and has increased since the same quarter last year. MBIA has reported somewhat volatile earnings of late, and its third-quarter earnings swung to a loss of 29 cents a share compared with a gain of $1.59 per share in the same period last year. However, TheStreet.com Ratings believes it is poised for EPS growth in upcoming quarters. The company's stock price is down 22.80% in the last 12 months, and despite the decline, is still selling for more than most others in its industry. MBIA was upgraded to a buy on Oct. 5, prior to which it had been rated a hold since August 2007.
Together with its subsidiaries,
provides open source software products to companies primarily in the United States. It has been upgraded to a buy from a hold. Its revenue increased by 27.7% in the second quarter of its fiscal 2008 compared with the same period last year, outpacing the industry average. Net income grew by 64.4% to $18.16 million in the second quarter, and its gross profit margin increased to 90.70%. Red Hat's stock price has gone up by 6.86% in the last 12 months, and unless broad bear market conditions prevail, TheStreet.com Ratings sees further upside potential for this stock. The company had been rated a hold since September 2007.
Construction equipment rental company
has been upgraded to a buy from a hold. The company's strengths can be seen in multiple areas, including earnings growth, revenue growth, attractive valuation levels, good cash flow from operations and solid stock price performance. These strengths outweigh the fact that the company has had generally poor debt management on most measures evaluated by TheStreet.com Ratings. Its stock price has increased by 38.82% in the last 12 months, driving it to a price level that is now somewhat expensive compared with the rest of its industry. Given its strengths, the higher price levels are justified. United Rentals had been rated a hold since April 2006.
makes and markets basic chemicals, vinyls, polymers and fabricated products. It has been downgraded to a hold from a buy. The company's strengths are seen in its revenue growth, a largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, the company has had feeble EPS growth, deteriorating net income and disappointing return on equity. Its stock price has declined by 29.38% in the last 12 months. Westlake had been rated a buy since August 2007.
Additional ratings changes are listed below.