Update (9:45 a.m.): Updated with Thursday market open information.
NEW YORK (TheStreet) -- Allegheny Technologies (ATI) received an upgrade to "outperform" from "neutral" from Credit Suisse. The firm cited valuation as the reason for the upgrade, along with recent weakness in the shares, limited downside, improved liquidity, and positive free cash flow in the near future. Credit Suisse set a target price of $41 up from $34.
Despite the upgrade, the stock hovered around its previous closing price of $32.01, with minor oscillations above and below that mark, shortly after the market opened on Thursday.
TheStreet Ratings team rates ALLEGHENY TECHNOLOGIES INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate ALLEGHENY TECHNOLOGIES INC (ATI) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. 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.
- ATI, with its decline in revenue, underperformed when compared the industry average of 3.9%. Since the same quarter one year prior, revenues fell by 14.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- ALLEGHENY TECHNOLOGIES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, ALLEGHENY TECHNOLOGIES INC reported lower earnings of $1.31 versus $1.98 in the prior year. For the next year, the market is expecting a contraction of 126.9% in earnings (-$0.35 versus $1.31).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 195.8% when compared to the same quarter one year ago, falling from $35.30 million to -$33.80 million.
- You can view the full analysis from the report here: ATI Ratings Report