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.
has been downgraded to a hold from a buy. The company's revenue rose by 20.1% in the third quarter compared with the same period last year, outpacing the industry average of 12.4%. Earnings also improved, rising to 21 cents per share from 18 cents a share a year earlier. Starbucks' debt-to-equity ratio of 0.37 is low and below the industry average. However, the company's stock price has dropped 31.44% in the past 12 months. While that could be one of the factors that may make the stock attractive down the road, TheStreet.com Ratings believe it is too soon to buy at this time. Starbucks had been rated a buy since August 2006.
develops and distributes telecommunications equipment, electronics components, solar energy systems and industrial ceramics. It has been downgraded to a hold from a buy. The company's debt-to-equity ratio of 0.02 in the second quarter of its fiscal year 2008 was below the industry average, suggesting that there has been very successful management of debt levels. Kyocera's net operating cash flow increased 147.48% to $408.60 million a year earlier. However, its net income fell 47.5% to $237.81 million over the same period, although that rate of decline was less than that of the electronic equipment-and-instruments industry average. The company's stock price has fallen by 7.00% in the last 12 months, and the fact that it is now selling for less than others in relation to its current earnings is not reason enough to justify a buy rating at this time. Kyocera had been rated a buy since November 2006.
performs construction work such as paving and resurfacing highways, and also distributes chemicals, plastics and resins. It has been downgraded to a hold from a buy. The company's net income fell by 84.0% in the fourth quarter of its fiscal year over the same period last year, due to weakness in the North American building and construction markets. Earnings per share dropped to 51 cents from $2.82 over the same period. The prior-year results included $144 million of income from operations that have since been discontinued. Ashland's revenue rose by 9.3%, boosted by double-digit growth from its performance materials and water technologies segments. In October, the company achieved a major milestone with the implementation of its SAP1 program, GlobalOne, in its European, Middle Eastern and African locations. Ashland had been rated a buy since September 2005.
is a homebuilder operating primarily in the U.S. It has been downgraded to a sell from a hold. The company swung to a loss of $3.25 per share in the third quarter compared with profits of $1.30 a share in the same period last year. Its revenues fell by 44.01% in the same timeframe, and its return on equity also greatly decreased. This is a sign of major weaknesses within the corporation. Lennar's stock price has fallen 48.18% in the past 12 months, and while it is now cheaper (in proportion to its earnings over the past year) than most other stocks in its industry, TheStreet.com Ratings feel that the stock is not a good buy right now. Lennar had been rated a hold since March 2007.
manufactures and distributes consumer products used in and around the home. It has been downgraded to a hold from a buy. The company's revenue grew by 28.0% in the third quarter compared with the same period last year, though the growth does not appear to have trickled down to the company's bottom line: Jarden's EPS fell to 28 cents from 78 cents over the same period last year. However, TheStreet.com Ratings believes the company is poised for earnings growth in the coming year. Its return on equity fell to 4.85% in the third quarter compared with 6.86% in the same period last year, a sign of internal weakness in the corporation. The company's return on equity significantly trails that of both the industry average and the
. Jarden had been rated a buy since May 2006.
Additional ratings changes are listed below.