TSC Ratings provides exclusive stock, ETF and mutual fund recommendations using proprietary tools. Our "safety-first" approach aims to reduce risk while achieving performance on a total return basis.The following companies, considered value stocks, have annual revenue of more than $500 million, less-than-average valuations, debt that is under 49% of total capital and receive "buy" ratings from TheStreet.com Ratings' proprietary quantitative model, which considers more than 60 factors. They are ordered by their potential to appreciate. New Jersey Resources ( NJR) provides retail and wholesale energy services to customers in New Jersey and other states from the Gulf Coast to New England and Canada. The numbers: Fiscal second-quarter revenue declined 20% to $938 million as net income and earnings per share surged 183% to $36 million and 83 cents, respectively. The debt-to-equity ratio remained low at 0.6, but a quick ratio of 0.4 indicates a weak cash position. Margins improved significantly during the quarter, with operating margin climbing to 6.2% and net margin jumping to 3.8%. The stock: New Jersey Resources has fallen 7% in 2009, in line with the Dow Jones Industrial Average. The stock trades at a price-to-earnings ratio of 13 and offers an attractive 3.4% dividend yield. UGI Corp. ( UGI) engages in the distribution and marketing of energy products and services in the U.S. and internationally. The company also operates a heating, ventilation, air conditioning and refrigeration business serving customers in the Mid-Atlantic region. The numbers: Fiscal second-quarter revenue dropped 9.5% to $2.1 billion as net income increased 25% to $158 million and earnings per share improved 24% to $1.45, continuing a trend of positive growth for eight consecutive quarters. A quick ratio of 0.9 indicates a less-than-ideal liquidity position and a debt-to-equity ratio of 1.5 reflects sizable leverage. Operating margin improved to 17% and net margin jumped to 7.4%. The stock: UGI has climbed 3% in 2009, outperforming the Dow and the S&P 500. Still, the stock trades at a price-to-earnings ratio under 10, indicating a significant discount to the market, and offers a 3.2% dividend yield.
Diamond Foods ( DMND) processes and markets culinary, snack, in-shell and ingredient nuts that are sold through two main product lines: Diamond of California and Emerald Nuts. The numbers: Fiscal third-quarter revenue ascended 11% to $111 million as net income increased 144% to $2.7 million and earnings per share improved 128% to 16 cents, establishing an eight-quarter growth streak. Operating margin increased to 5.5% and net margin improved to 2.4%. Just $1.5 million of cash and a quick ratio of 0.3 suggest weak liquidity. But a debt-to-equity ratio of 0.7 indicates conservative leverage. The stock: Diamond has climbed 26% in 2009, outperforming all major U.S. indexes. The stock trades at a price-to-earnings ratio around 19 and pays a low dividend yield of 0.7%. Enterprise Products Partners ( EPD) is a midstream energy company that provides services to producers and consumers of natural gas, NGLs, crude oil and petrochemicals in the U.S., Canada and the Gulf of Mexico. The numbers: First-quarter revenue fell 40% to $3.4 billion as net income weakened 13% to $225 million and earnings per share fell 20% to 41 cents. A quick ratio of 0.6 and a debt-to-equity ratio of 1.5 indicate a less-than-ideal financial position. However, margins improved significantly, with operating margin climbing to 11% and net margin jumping to 6.6%. The stock: Enterprise Products has climbed 24% in 2009, outperforming all major U.S. indexes. Yet, at its current price, the stock still offers a cash distribution yield of 8.3%. Cash distributions are taxed differently than dividends.
Village Super Market ( VLGEA) operates a chain of ShopRite supermarkets in the U.S. The numbers: Fiscal third-quarter revenue increased 7% to $293 million as net income increased 25% to $6.3 million and earnings per share climbed 24% to 47 cents. Same-store sales, a gauge of year-over-year improvement, jumped more than 7%. The company has a modest $36 million debt-load and over $47 million of cash, which works out to a quick ratio of 0.8 and a debt-to-equity ratio of 0.2. The stock: Village Super Market has climbed 1% in 2009 and is up 11% from its March low. The stock trades at a price-to-earnings ratio of 17 and offers a 3% dividend yield. TSC Ratings was given an award for "Best Stock Selection" amongst independent research providers by BNY ConvergEx Group. To see how your portfolio can utilize our research, click here. A rating can be viewed for any stock through our screener stock rating screener. Each rating is derived from a variety of fundamental and pricing figures and represents our opinion of risk-adjusted performance relative to a 5,000+ stock coverage universe. However, the rating does not incorporate all factors that can alter a stock's performance, such as corporate or industry events, technology innovations and shifts in competitive dynamics.