UPS, U.S. Steel, Cummins: Ratings Upgrades
BOSTON (TheStreet) -- Here are three upgrades from TheStreet's stock-rating model.
3. The model upgraded
U.S. Steel
(X) - Get United States Steel Corporation Report
to "hold."
Quarter
: U.S. Steel swung to a fourth-quarter loss of $267 million, or $1.86, from a profit of $290 million, or $2.50, a year earlier. Revenue dropped 26%. The operating margin fell into negative territory. U.S. Steel has $1.3 billion of cash and $3.4 billion of debt.
Stock
: U.S. Steel has surged 147% during the past year, more than U.S. indices. The stock trades at a price-to-projected-earnings ratio of 14 and a price-to-book ratio of 2, 29% and 53% discounts to industry averages. It's also cheap based on sales.
Consensus
: Of analysts covering U.S. Steel, eight, or 53%, advise purchasing its shares, four recommend holding and three suggest selling them.
KeyCorp
expects the stock to advance 32% to $85.
Bank of America
(BAC) - Get Bank of America Corp Report
TheStreet Recommends
predicts it will hit $78.
>> Who Owns U.S. Steel?: Bruce Kovner
2. The model upgraded
Cummins
(CMI) - Get Cummins Inc. Report
to "buy."
Quarter
: Fourth-quarter profit rose fivefold to $270 million, or $1.36, as revenue grew 3.4% to $3.4 billion. The operating margin expanded from 2.8% to 9.3%. Cummins has $1.1 billion of cash and $704 million of debt, equal to a debt-to-equity ratio of 0.2.
Stock
: Cummins has doubled during the past year, beating major benchmarks. It sells for a price-to-projected-earnings ratio of 17 and a price-to-sales ratio of 1.2, 31% and 15% discounts to industry averages. It's expensive based on book value.
Consensus
: Of researchers following Cummins, 11, or 58%, rate its stock "buy", seven rate it "hold" and one rates it "sell."
UBS
(UBS) - Get UBS Group AG Report
says the stock could increase 22% to $80.
Goldman Sachs
(GS) - Get Goldman Sachs Group, Inc. Report
expects the shares to gain 15% to $75.
1. The model upgraded
UPS
(UPS) - Get United Parcel Service, Inc. Class B Report
to "buy."
Quarter
: Fourth-quarter profit tripled to $757 million, or 75 cents, as revenue declined 2.5% to $12 billion. The operating margin tightened from 11% to 10%. UPS has $2.1 billion of cash and $9.5 billion of debt, amounting to a debt-to-equity ratio of 1.2.
Stock
: UPS has risen 21% during the past year, lagging behind U.S. indices. The stock trades at a price-to-projected-earnings ratio of 18 and a price-to-cash-flow ratio of 12, 23% and 16% discounts to peer-group averages. It's expensive based on book value.
Consensus
: Of firms rating UPS, 13, or 54%, advocate purchasing its shares, 10 advise holding and one recommends selling them.
RBC
(RY) - Get Royal Bank of Canada Report
predicts the stock will climb 17% to $76.
JPMorgan
(JPM) - Get JPMorgan Chase & Co. Report
believes the shares will rise to $74.
Visit Stockpickr's
and
>> Who Owns UPS?: Wallace Weitz
-- Reported by Jake Lynch in Boston.
