Bare Escentuals, Cracker Barrel: Ratings Changes

BOSTON ( TheStreet) -- TheStreet.com's stock-rating model upgraded cosmetics maker Bare Escentuals ( BARE) to "hold."

The numbers: Second-quarter net income declined 20% to $20 million, or 21 cents a share. Revenue dropped 4% to $132 million. Its gross margin rose from 72% to 73%, but its operating margin fell from 33% to 26%. A quick ratio of 2.4 demonstrates ample liquidity. However, a debt-to-equity ratio of 5.7 indicates high debt.

The stock: Bare Escentuals shares have more than doubled this year, beating major U.S. indices. The stock trades at a price-to-earnings ratio of 13, a discount to the market and personal-products peers. The company doesn't pay dividends.

The model upgraded restaurant operator Cracker Barrel Old Country Store ( CBRL) to "buy."

The numbers: Fiscal fourth-quarter profit rose 9% to $23 million, or 99 cents a share, as revenue fell 1% to $596 million. Its gross margin rose from 71% to 72%, and its operating margin remained steady at 7%. The company has a weak financial position, with $638 million of debt and $12 million of cash.

The stock: Cracker Barrel is up 67% this year, outpacing major U.S. indices. The stock trades at a price-to-earnings ratio of 12, a discount to the market and restaurant peers. The shares offer a 2.3% dividend yield.

The model upgraded packaging products maker Crown Holdings ( CCK) to "buy."

The numbers: Second-quarter net income increased 6% to $105 million, or 65 cents cents a share. Its gross margin fell from 19% to 18%, but its operating margin rose from 11% to 12%. A quick ratio of 0.9 demonstrates less-than-ideal liquidity. The balance sheet holds $3.7 billion of debt, compared to $706 million of cash.

The stock: Crown Holdings is up 41% this year, more than major U.S. indices. The stock trades at a price-to-earnings ratio of 18, a discount to the market and container peers.

The model upgraded consultant ICF International ( ICFI) to "buy."

The numbers: Second-quarter net income dropped 35% to $5.2 million, or 33 cents a share. Revenue declined 5% to $175 million. Its gross margin rose from 35% to 41%, but its operating margin fell from 8% to 6%. A quick ratio of 1.7 indicates adequate liquidity. A debt-to-equity ratio of 1 reflects higher-than-ideal leverage.

The stock: ICF International is up 20% this year, beating the Dow Jones Industrial Average and S&P 500 Index. The stock trades at a price-to-earnings ratio of 19, which is comparable to the market, but a discount to consulting peers. The company doesn't pay dividends.

The model upgraded electricity provider UIL Holdings ( UIL) to "buy."

The numbers: Second-quarter net income jumped 22% to $14 million and earnings per share rose 16% to 51 cents, restrained by a higher share count. Revenue fell 7% to $200 million. Its gross margin rose from 24% to 27% and its operating margin increased from 12% to 15%. A quick ratio of 0.6 demonstrates weak liquidity. A debt-to-equity ratio of 1.2 is higher-than-ideal, but heavy debt is common among utilities.

The stock: UIL Holdings is down 10% this year, trailing major U.S. indices. The stock trades at a price-to-earnings ratio of 12, a discount to the market and utility peers. The shares offer a 6.4% dividend yield.

-- Reported by Jake Lynch in Boston.

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