Why Compass Minerals (CMP) Was Upgraded

NEW YORK (TheStreet) -- Credit Suisse upgraded Compass Minerals (CMP) to "neutral" from "underperform" Thursday.

Compass Minerals gained 1.5% to $82.40 in early morning trading.

The analyst firm set a price target of $88 for the mineral company, above its Wednesday closing price of $81.16. Credit Suisse believes the company will see greater demand for salt given recent weather conditions.

------------

Separately, TheStreet Ratings team rates COMPASS MINERALS INTL INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate COMPASS MINERALS INTL INC (CMP) 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 net income, revenue growth and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 63.8% when compared to the same quarter one year prior, rising from $9.40 million to $15.40 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 2.4%. Since the same quarter one year prior, revenues slightly increased by 2.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • COMPASS MINERALS INTL INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, COMPASS MINERALS INTL INC reported lower earnings of $2.65 versus $4.45 in the prior year. This year, the market expects an improvement in earnings ($3.86 versus $2.65).
  • The gross profit margin for COMPASS MINERALS INTL INC is currently lower than what is desirable, coming in at 34.54%. Regardless of CMP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 8.33% trails the industry average.
  • Net operating cash flow has significantly decreased to -$33.70 million or 301.79% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

If you liked this article you might like

Mapping Out a Profit With Compass Minerals

Trade-Ideas: Compass Minerals International (CMP) Is Today's "Barbarian At The Gate" Stock

Analysts' Actions -- Best Buy, Salesforce, Cisco, P&G and More

Ex-Dividend Alert: 3 Stocks Going Ex-Dividend Tomorrow: PEI, CMP, EXPD

3 Buy-Rated Dividend Stocks: CMP, CCI, T