The following ratings changes were generated on Wednesday, Feb. 11.

We've downgraded Hercules Offshore ( HERO), which provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry, from hold to sell. This rating was driven by the company's its deteriorating net income, disappointing return on equity, poor profit margins, generally weak debt management and generally disappointing historical performance in the stock itself.

Net income decreased from $31.3 million in the year-ago quarter to -$1.1 billion, significantly underperforming both the S&P 500 and the energy equipment and services industry. Return on equity also greatly decreased, a signal of major weakness within the corporation. Hercules Offshore's gross profit margin of 32% is lower than desirable, though it has increased from the same period last year. Its net profit margin of -358.8% significantly underperformed the industry average, and its debt-to-equity ratio of 1.2 is relatively high, suggesting a need for better debt-level management. The company's quick ratio is somewhat strong at 1.5, demonstrating its ability to handle short-term liquidity needs.

Shares tumbled 84.4% over the last year, underperforming the S&P 500, and EPS fell 3,554.1% compared with the year-ago quarter. Naturally, the overall market trend is bound to be a significant factor, and in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

We've downgraded film studio Lions Gate Entertainment ( LGF) from hold to sell, driven by its feeble growth in its earnings per share, deteriorating net income, generally weak debt management, disappointing return on equity and weak operating cash flow.

Lions Gate experienced a steep decline in EPS in the most recent quarter compared with the year-ago quarter, continuing a two-year trend of declining EPS. Net income fell from $7.3 million in the year-ago quarter to -$93.4 million, significantly underperforming the S&P 500 and the media industry. ROE also greatly decreased, significantly trailing the industry average. Net operating cash flow decreased to -$56.2 million, or by 939.8% compared with the year-ago quarter. Lions Gate's 89.1 debt-to-equity ratio is very high and above the industry average, implying very poor management of debt levels within the company.

We've downgraded Nvidia ( NVDA - Get Report), which provides visual computing technologies designed to generate interactive graphics on consumer and profession computing devices, from hold to sell. This rating is driven by the company's deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Net income fell from $257 million in the same quarter last year to -$147.7 million, significantly underperforming the S&P 500 and the semiconductors and semiconductor equipment industry. ROE also greatly decreased, a signal of major weakness within the corporation. EPS fell by 164.3% compared with the year-ago quarter, but the consensus estimate suggests that the company's two-year trend of declining EPS should reverse in the coming year. Nvidia's 28.1% gross profit margin is lower than desirable, having decreased significantly from the same period last year, and its net profit margin of 30.7% Is significantly below the industry average.

Shares have tumbled by 62.7% over the past year, underperforming the S&P 500. Naturally, the overall market trend is bound to be a significant factor, and in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

We've downgraded real estate investment trust ProLogis ( PLD - Get Report) from hold to sell, driven by its deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Net income fell from $119.6 million in the same quarter a year ago to -$880.7 million in the most recent quarter, significantly underperforming the S&P 500 and the REITs industry. ROE also greatly decreased, a signal of major weakness. EPS declined by 855.9% compared with the year-ago quarter, though the consensus estimate suggests that the company's two-year trend of declining EPS should reverse in the coming year. Despite the current debt-to-equity level of 1.7, it is still below the industry average, suggesting that this level of debt is acceptable within the REITs industry.

Shares have tumbled by 885.1% over the past year, underperforming the S&P 500. Naturally, the overall market trend is bound to be a significant factor, and in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

We've upgraded Qiagen ( QGEN - Get Report), which provides sample and assay technologies and products worldwide, from hold to buy. This rating is driven by the company's revenue growth, impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Revenue rose by 12.8% compared with the year-ago quarter, appearing to have helped boost EPS, which improved significantly. The company has demonstrated a pattern of positive EPS growth over the past year that we feel should continue. Net income increased by 64.5% compared with the year-ago quarter, from $15 million to $24.7 million, significantly outperforming the S&P 500 and the life sciences tools and services industry. ROE has improved slightly, which can be construed as a modest strength in the organization. Qiagen's 0.7 debt-to-equity ratio is somewhat low overall but is high compared with the industry average. Its quick ratio of 1.95 is high and demonstrates strong liquidity.

Other ratings changes included Applied Materials ( AMAT - Get Report) and Buckeye Technologies ( BKI - Get Report), both downgraded from hold to sell.

All ratings changes generated on Feb. 11 are listed below.

Ticker
Company
Current
Change
Previous
AJG
Arthur J. Gallagher
HOLD
Downgrade
BUY
AMAT
Applied Materials
SELL
Downgrade
HOLD
BKI
Buckeye Technologies
SELL
Downgrade
HOLD
BNI
Burlington Northern Santa Fe
HOLD
Downgrade
BUY
CGX
Consolidated Graphics
SELL
Downgrade
HOLD
COHR
Coherent
SELL
Downgrade
HOLD
CYBI
Cybex International
SELL
Downgrade
HOLD
DHIL
Diamond Hill Investment
HOLD
Downgrade
BUY
DNBK
Danvers Bancorp
SELL
Initiated
HERO
Hercules Offshore
SELL
Downgrade
HOLD
IESC
Integrated Electrical Services
HOLD
Upgrade
SELL
ITLN
Intellon
SELL
Initiated
LGF
Lions Gate Entertainment
SELL
Downgrade
HOLD
LRN
K12
SELL
Initiated
NVDA
Nvidia
SELL
Downgrade
HOLD
PLD
Prologis
SELL
Downgrade
HOLD
QGEN
Qiagen
BUY
Upgrade
HOLD
SAB
Grupo Casa Saba
SELL
Downgrade
HOLD
VNUS
VNUS Medical Technologies
BUY
Upgrade
HOLD

Each business day, TheStreet.com Ratings updates its ratings on the stocks it covers. The proprietary ratings model projects a stock's total return potential over a 12-month period, including both price appreciation and dividends. Buy, hold or sell ratings designate how the Ratings group expects these stocks to perform against a general benchmark of the equities market and interest rates.

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