Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. TheStreet Ratings quantitative algorithm evaluates over 4,300 stocks on a daily basis by 32 different data factors and assigns a unique buy, sell, or hold recommendation on each stock. Click here to learn more.
NEW YORK (TheStreet) -- Mack-Cali Realty (CLI) - Get Report has been downgraded by TheStreet Ratings from Hold to Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate MACK-CALI REALTY CORP (CLI) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 57.3% when compared to the same quarter one year ago, falling from $4.64 million to $1.98 million.
- The gross profit margin for MACK-CALI REALTY CORP is rather low; currently it is at 19.52%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, CLI's net profit margin of 1.27% is significantly lower than the industry average.
- Net operating cash flow has decreased to $30.55 million or 21.14% when compared to the same quarter last year. Despite a decrease in cash flow MACK-CALI REALTY CORP is still fairing well by exceeding its industry average cash flow growth rate of -31.47%.
- CLI has underperformed the S&P 500 Index, declining 12.94% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, MACK-CALI REALTY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: CLI Ratings Report