Comcast, Corning: Ratings Changes
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BOSTON (
) -- TheStreet.com's stock-rating model upgraded cable provider
Comcast
(CMCSK)
to "buy."
The numbers
: Second-quarter net income grew 53% to $967 million, or 33 cents a share. Revenue increased 5% to $8.9 billion. Its gross margin remained steady at 58% and its operating margin was little changed at 21%. A quick ratio of 0.5 indicates weak liquidity. But the company has a reasonable debt load, reflected by its debt-to-equity ratio of 0.8.
The stock
: Comcast has dropped 10% this year, trailing behind major U.S. indices. The stock trades at a price-to-earnings ratio of 15, a discount to the market and cable peers. The shares offer a 1.9% dividend yield.
The model downgraded
Corning
(GLW) - Get Report
, a maker of specialty glass for plasma and liquid crystal displays, to "hold."
The numbers
: Second-quarter profit dropped 81% to $611 million, or 39 cents a share, as revenue declined 18% to $1.4 billion. Its gross margin decreased from 60% to 54% and its operating margin fell from 25% to 16%. Corning has a strong financial position, with $3 billion of cash and $2 billion of debt. A quick ratio of 2.5 and debt-to-equity ratio of 0.2 demonstrate fiscal prudence.
The stock
: Corning has surged 56% this year, outpacing major U.S. indices. The stock trades at a price-to-earnings ratio of 14, a discount to the market and electronic component peers. The shares offer a 1.3% dividend yield.
The model downgraded fast-food chain
Jack in the Box
(JACK) - Get Report
to "hold."
The numbers
: Fiscal third-quarter earnings fell 35% to $20 million, or 31 cents a share, as revenue decreased 3% to $576 million. Its gross margin rose from 21% to 23% and its operating margin climbed from 7% to 8%. Just $12 million of cash reserves and a quick ratio of 0.2 demonstrate weak liquidity. A debt-to-equity ratio of 0.8 indicates reasonable leverage.
The stock
: Jack in the Box is down 9% this year, lagging behind major U.S. indices. The stock trades at a price-to-earnings ratio of 10, a discount to the market and restaurant peers. The company doesn't pay dividends.
The model upgraded
Packaging Corp. of America
(PKG) - Get Report
to "buy."
The numbers
: Second-quarter net income surged 209% to $109 million, or $1.07 a share, as revenue fell 11% to $549 million. Its gross margin rose from 27% to 28%, but its operating margin fell from 12% to 11%. A quick ratio of 1.5 reflects ample liquidity and a debt-to-equity ratio of 0.8 indicates reasonable leverage.
The stock
: Packaging Corp. of America has advanced 47% this year, beating major U.S. indices. The stock trades at a price-to-earnings ratio of 10, a discount to the market and packaging peers. The shares offer a 3% dividend yield.
The model upgraded electricity provider
Southern Co.
(SO) - Get Report
to "buy."
The numbers
: Second-quarter net income increased 14% to $495 million, or 60 cents a share, restrained by a higher share count. Revenue dropped 8% to $3.9 billion. Its gross margin jumped from 30% to 32% and its operating margin rose from 22% to 23%. Southern has a weak financial position, evident in its quick ratio of 0.5 and debt-to-equity ratio of 1.4.
The stock
: Southern has dropped 16% this year, trailing major U.S. indices. The stock trades at a price-to-earnings ratio of 15, which is comparable to utility peers, but a discount to the market. The shares offer a dividend yield of 5.6%, higher than the average of S&P 500 companies.
-- Reported by Jake Lynch in Boston
.
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