Adobe, Fluor, Carnival: Ratings Changes - TheStreet

Adobe, Fluor, Carnival: Ratings Changes

Fluor Corp., Crown Castle International, National Bank of Greece, Southwestern Energy, Adobe Systems and Carnival Corp. had their ratings changed by TheStreet.com.
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BOSTON (

TheStreet

) -- TheStreet.com's stock-rating model downgraded

Fluor Corp.

(FLR) - Get Report

, a specialized construction and engineering company, to "hold."

The numbers

: Third-quarter profit decreased 11% to $162 million, or 89 cents a share. Revenue declined 5% to $5.4 billion. Fluor's gross margin remained steady at 6%, and its operating margin was unchanged at 5%. The company has an admirable financial position, with $2 billion of cash and $136 million in debt. We give Fluor a financial-strength score of 9.9 out of 10.

The stock

: Fluor has fallen 3% this year, underperforming major U.S. indices. The stock trades at a price-to-earnings ratio of 11, a discount to the market and construction and engineering peers. The shares offer a 1.1% dividend yield.

The model upgraded

Crown Castle International

(CCI) - Get Report

, an owner of telecom towers, to "hold."

The numbers

: The company's third-quarter loss narrowed 2% to $32 million, but its per-share loss stalled at 13 cents. Revenue grew 12% to $429 million. Crown Castle's gross margin stretched from 65% to 68%, and its operating margin widened from 21% to 28%. A quick ratio of 0.7 indicates less-than-ideal liquidity. The company's 1.9 debt-to-equity ratio reflects excessive leverage.

The stock

: Crown Castle International has surged 120% this year, beating major U.S. indices. The company has suffered significant losses over the past three years. Crown Castle doesn't pay dividends.

The model downgraded

National Bank of Greece

(NBG)

to "hold."

The numbers

: Third-quarter net income improved 13% to $484 million, but earnings per share fell 6% to 16 cents. Revenue increased 19% to $2.9 billion. The company's gross margin stretched from 48% to 54%, but its net margin declined from 17% to 16%. National Bank of Greece holds $12 billion of cash and short-term investments and $4.2 billion of debt. Still, the company was recently put on watch for a credit downgrade at

Standard & Poor's

.

The stock

: National Bank of Greece has climbed 28% this year, but dropped 27% over the past month on concern about budget problems. The stock trades at a price-to-earnings ratio of 7, a discount to the market and commercial-bank peers. The shares don't consistently pay dividends.

The model upgraded oil and gas company

Southwestern Energy

(SWN) - Get Report

to "buy."

The numbers

: Third-quarter profit plummeted 46% to $118 million, or 34 cents a share. Revenue fell 26% to $503 million. Southwestern Energy's gross margin rose from 59% to 61%, but its operating margin descended from 44% to 39%. The company has a poor financial position, with just $10 million of cash and $956 million of debt. Its quarterly interest expenses total $15 million.

The stock

: Southwestern Energy has returned 67% this year, more than major U.S. indices. Still, the company suffered a loss of $1.26 a share in the first quarter. Southwestern Energy doesn't pay dividends.

The model downgraded application-software designer

Adobe Systems

(ADBE) - Get Report

to "hold."

The numbers

: Adobe swung to a fiscal fourth-quarter loss of $32 million, or 6 cents a share, from a profit of $246 million, or 46 cents a share, a year earlier. Revenue dropped 17% to $757 million. Adobe's gross margin slimmed from 89% to 86%, and its gross margin fell from 33% to 24%. The company has a stable financial position, with $1.9 billion of cash and $1 billion of debt.

The stock

: Adobe Systems has increased 75% this year, outpacing major U.S. indices. The stock trades at a price-to-earnings ratio of 50, a premium to the market and software peers. Adobe doesn't pay dividends.

The model downgraded cruise company

Carnival Corp.

(CCL) - Get Report

to "hold."

The numbers

: Fiscal fourth-quarter profit slumped 48% to $193 million, or 24 cents a share. Revenue declined 3% to $3.2 billion. Carnival's gross margin narrowed from 34% to 33%, and its operating margin decreased from 13% to 9%. Carnival has a poor liquidity position, evident in its quick ratio of 0.2. Its 0.5 debt-to-equity ratio indicates conservative leverage.

The stock

: Carnival Corp. has ascended 33% this year, more than the

Dow Jones Industrial Average

and

S&P 500 Index

. The stock trades at a price-to-earnings ratio of 14, a discount to the market and leisure peers. Carnival doesn't pay dividends.

-- Reported by Jake Lynch in Boston.