TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

The following ratings changes were generated on Friday, May 1.

We've downgraded

BioMarin Pharmaceutical

(BMRN) - Get Report

from hold to sell, driven by its generally disappointing historical performance in the stock itself, unimpressive growth in net income, generally weak debt management and feeble growth in its earnings per share.

Net income fell from $1.7 million in the year-ago quarter to -$13.2 million in the most recent quarter. BioMarin has a debt-to-equity ratio of 1.8, which is high compared with the industry average. It maintains a strong quick ratio of 4.9. EPS declined in the most recent quarter compared with the same quarter last year, and we feel the company is likely to report a decline in earnings in the coming year. Return on equity rose from the year-ago quarter.

Shares have tumbled 64.7% over the past year, underperforming the

S&P 500

. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

We've downgraded

Cabot

(CBT) - Get Report

from hold to sell, driven by its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

EPS are down in the most recent quarter compared with the year-ago quarter, and we anticipate that the company's yearlong pattern of declining EPS should continue in the coming year. Net income fell from $11 million in the year-ago quarter to -$56 million in the most recent quarter. ROE also fell, implying weakness within the company. Cabot's 8.7% gross profit margin has decreased from the year-ago period, and its net profit margin of -11.9% is below the industry average.

Shares have tumbled 49.9% over the past year, underperforming the S&P 500. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

We've upgraded

Fastenal

(FAST) - Get Report

from hold to buy, driven by its largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Fastenal has no debt to speak of and a quick ratio or 2.3. Its gross profit margin of 55% has increased from the same quarter last year, and its net profit margin of 10% is above the industry average. Cash flow increased 7.8% to $93.5 million compared with the year-ago quarter. Revenue fell 13.6%, and EPS decreased ROE also fell, implying a minor weakness in the organization.

We've upgraded

Google

(GOOG) - Get Report

from hold to buy, driven by its growth in earnings per share, increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

EPS are up 9% in the most recent quarter compared with the same quarter last year, and we feel that the company's two-year trend of EPS growth should continue. Net income is up 8.8%, from $1.3 billion in the year-ago quarter to $1.4 billion in the most recent quarter. Revenue increased by 6.2% compared with 7.7% growth for the industry average. Google has no debt to speak of and maintains a quick ratio of 9.3. Its 67.7% gross profit margin has increased from the year-ago quarter, and its 25.8% net profit margin is above the industry average.

We've upgraded

Polo Ralph Lauren

(RL) - Get Report

from hold to buy, driven by its largely solid financial position with reasonable debt levels by most measures, notable return on equity, attractive valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

The company's debt-to-equity ratio of 0.2 is below the industry average, implying successful management of debt levels. Its quick ratio is 1.7. ROE has improved slightly since the year-ago quarter. The 53.5% gross profit margin has increased from the year-ago quarter. The 8.4% net profit margin is above the industry average. EPS from the most-recent quarter are slightly below the year-earlier quarter, and we feel the company is likely to report a decline in earnings in the coming year.

Other ratings changes include

Arris Group

(ARRS) - Get Report

, upgraded from sell to hold, and

Crown Castle International

(CCI) - Get Report

, upgraded from sell to hold.

All ratings changes for May 1 are listed below.

Note: Our quantitative model makes stock recommendations based on GAAP figures that may differ materially from data as reported by the companies themselves. As a result, rating changes are occasionally driven by so-called nonrecurring items. As always, we urge readers to use TSC Ratings' reports in conjunction with additional information to construct their opinions on the value that should be placed on any given stock.

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