Will This Upgrade Help Veeco Instruments (VECO) Today?

Update (9:40 a.m.): Updated with Wednesday market open information.

NEW YORK (TheStreet) -- Credit Suisse upgraded Veeco Instruments  (VECO) to "outperform" from "neutral" and set a target price of $50. The firm said the order outlook is improving.

The stock was rising 2.33% to $39.50 shortly after the market opened on Wednesday.

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Separately, TheStreet Ratings team rates VEECO INSTRUMENTS INC as a "hold" with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

"We rate VEECO INSTRUMENTS INC (VECO) 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 largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. 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:

  • VECO's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 6.24, which clearly demonstrates the ability to cover short-term cash needs.
  • 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.
  • The revenue fell significantly faster than the industry average of 5.3%. Since the same quarter one year prior, revenues fell by 25.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for VEECO INSTRUMENTS INC is currently lower than what is desirable, coming in at 33.78%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -6.06% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$9.14 million or 120.18% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • You can view the full analysis from the report here: VECO Ratings Report

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