Each weekday, TheStreet.com Ratings updates its ratings on the stocks we cover. Our model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Our buy, hold or sell ratings designate how we expect these stocks to perform against a general benchmark of the equities market and interest rates.
While our 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 forecasted company earnings. Objective elements include volatility of past operating revenue, financial strength and company cash flows.
Some recent rating changes are highlighted below.
Subprime mortgage lender
( NFI) has been downgraded to a sell from a hold. NovaStar lost 32 cents per share in the fourth quarter of fiscal 2006, a significant turn for the worse for a company that earned 73 cents per share in the previous quarter. TheStreet.com Ratings expects this trend to continue. NFI had been rated a hold since April 2005.
Furniture manufacturer and retailer
has been downgraded to a sell from a hold. The company lost 35 cents per share in the first quarter of fiscal 2007. It had earned 18 cents per share during the same quarter a year ago. Bassett's stock price has fallen 25.9% over the past 12 months. BSET had been rated a hold since October 2006.
( CMRG) has been upgraded to a buy from a hold. The company's revenues grew 12.6% in the fourth quarter of fiscal 2006 compared to the same quarter a year ago. The average rate of revenue growth throughout the specialty retail industry was just 1.8% during that same period. TheStreet.com Ratings feels Casual Male's 47.9% gross profit margin is strong. CMRG had been rated a hold since December 2006.
Oil and gas driller
has been upgraded to a buy from a hold. The company's revenues shot up 86.8% in the fourth quarter of fiscal 2006 compared to the same quarter a year ago. Net operating cash flow also increased significantly over that same time period. Petrohawk's gross profit margin currently stands at 78.7%. HK had been rated a hold since August 2006.
( IFSIA) has been upgraded to a buy from a hold. The company's revenues have grown 13.5% over the past fiscal year, slightly outpacing the commercial services and supplies industry average of 12.1%. Net income was up 111.5% in the fourth quarter of fiscal 2006 compared to the same quarter a year ago. TheStreet.com Ratings feels Interface is poised for earnings per share growth in the coming year. IFSIA had been rated a hold since June 2005.
Additional ratings changes are listed in the table below.