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NEW YORK (TheStreet) -- Thompson Creek Metals (TC) - Get Free Report was gaining 11.2% to $2.98 Monday after pricing its exchange offer of common stock for its 6.5% tangible equity units.

Thompson Creek is offering to exchange 5.8458 shares for each tendered and accepted tangible equity unit. The exchange ratio is equal to the sum of 5.3879 shares of common stock and a number of shares equal to $1.25 divided by the five day daily volume-weighted price of $2.73.

Those who participate in the exchange will also receive the accrued portion of the 40.625 quarterly cash installment accrued from May 15.

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TheStreet Ratings team rates THOMPSON CREEK METALS CO INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate THOMPSON CREEK METALS CO INC (TC) a SELL. This is driven by multiple weaknesses, 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 unimpressive growth in net income, poor profit margins 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 Metals & Mining industry. The net income has significantly decreased by 4444.4% when compared to the same quarter one year ago, falling from $0.90 million to -$39.10 million.
  • The gross profit margin for THOMPSON CREEK METALS CO INC is currently lower than what is desirable, coming in at 33.04%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -24.28% is significantly below that of the industry average.
  • The share price of THOMPSON CREEK METALS CO INC has not done very well: it is down 13.48% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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 company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, THOMPSON CREEK METALS CO INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • TC's debt-to-equity ratio of 0.98 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.50 is sturdy.
  • You can view the full analysis from the report here: TC Ratings Report

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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.