Mack-Cali Realty Corp Stock Downgraded (CLI)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Mack-Cali Realty (NYSE: CLI) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.

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Highlights from the ratings report include:
  • CLI's revenue growth trails the industry average of 18.7%. Since the same quarter one year prior, revenues slightly increased by 0.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • The gross profit margin for MACK-CALI REALTY CORP is currently lower than what is desirable, coming in at 27.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 5.60% significantly trails the industry average.
  • Net operating cash flow has declined marginally to $79.66 million or 8.95% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
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Mack-Cali Realty Corporation is a real estate investment trust (REIT). It engages in the leasing, management, acquisition, development, and construction of commercial real estate properties in the United States. The company has a P/E ratio of 32.7, above the average real estate industry P/E ratio of 31.6 and above the S&P 500 P/E ratio of 17.7. Mack-Cali has a market cap of $2.3 billion and is part of the financial sector and real estate industry. Shares are down 0.2% year to date as of the close of trading on Thursday.

You can view the full Mack-Cali Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

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