Analysts' Actions: Costco, Dollar Tree, Juniper, Walmart

NEW YORK (TheStreet) -- RATINGS CHANGES

Albermarle (ALB) was upgraded at Topeka Capital to buy from hold. Twelve-month price target is $91. Company has several positive near-term catalysts, Topeka said.

Avery Dennison (AVY) was downgraded at Topeka Capital to hold from buy. Twelve-month price target is $54. Domestic demand momentum has slowed, Topeka Capital said.

Barnes (B) was downgraded at Deutsche Bank to hold from buy. Twelve-month price target is $40. Company is seeing slower organic growth, Deutsche said.

Bank of Hawaii (BOH) was upgraded at DA Davidson to buy. Twelve-month price target is $65. Company is posting its strongest growth in more than a decade, DA Davidson said.

Boston Scientific (BSX) was initiated with a neutral rating at Sterne Agee. Valuation call, based on a 12-month price target of $13.50.

Costco (COST) was upgraded at Goldman Sachs to buy from neutral. Company was also placed on the Conviction list. Expect earnings growth to reaccelerate, said Goldman Sachs. Twelve-month price target is $136.

Dollar Tree (DLTR) was downgraded at BMO Capital to market perform from outperform. Twelve-month price target is $59. Family Dollar merger will likely cut into return on invested capital, BMO Capital said.

Fortegra Financial (FRF) was upgraded to buy at TheStreet Ratings.

Juniper (JNPR) was upgraded at Bernstein to outperform from market perform. Twelve-month price target is $30. Turnaround potential still exists and revenue risk is already priced in, Bernstein said.

Liberty Media (LMCA) was downgraded to sell at TheStreet Ratings.

Microstrategy (MSTR) was upgraded at Deutsche Bank to outperform from market perform. Twelve-month price target is $170. Subscription business is driving growth and management is providing more clarity for investors, Deutsche Bank said.

Matador Resources (MTDR) was upgraded at BMO Capital to outperform. Twelve-month price target is $32. Company has attractive growth potential both for this quarter and looking ahead, BMO Capital said.

Pharmacyclics (PCYC) was upgraded at Leerink Swann to outperform from market perform. Twelve-month price target is $142. Expect that Zydelig and Imbruvica can drive near-term growth, Leerink Swann said.

Provident Financial (PFS) was upgraded at Sterne Agee to buy from neutral. Company can augment organic growth with the recent Team Capital purchase, Sterne Agee said. Twelve-month price target is $19.

RBC Bearings (ROLL) was downgraded at Goldman Sachs to neutral from buy. Estimates were also cut, given low sales visibility, and margins appear to have peaked, Goldman said. Twelve-month price target is $66.

St. Jude (STJ) was initiated with a neutral rating at Sterne Agee. Twelve-month price target is $74. Uncertainty remains around the rollout of new products, Sterne Agee said.

Thoratec (THOR) was downgraded at Wells Fargo to market perform from outperform. Third-party channel checks suggest that near-term sales will fall short of expectations in the U.S. and Europe, Wells Fargo said.

Walmart (WMT) was downgraded at Goldman Sachs to neutral from buy. Twelve-month price target is $83. Company's current strategy will likely cause lower returns on capital, Goldman said.

Zions (ZION) was upgraded at Bernstein to market perform from underperform. Valuation call, based on a $30 price target, Bernstein said.

Editor's note: To see analysts' stock comments and changes to price targets and earnings estimates, go to "Street Notes" which is available only to Real Money subscribers. To find out how to become a subscriber, please click here.

Follow TheStreet on Twitter and become a fan on Facebook.


Now let's look at TheStreet Ratings' take on some of these stocks.

TheStreet Ratings team rates COSTCO WHOLESALE CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate COSTCO WHOLESALE CORP (COST) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and growth in earnings per share. We feel these strengths outweigh the fact that the company shows low profit margins."

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

  • The revenue growth came in higher than the industry average of 4.8%. Since the same quarter one year prior, revenues slightly increased by 7.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Food & Staples Retailing industry average. The net income increased by 3.0% when compared to the same quarter one year prior, going from $459.00 million to $473.00 million.
  • Net operating cash flow has increased to $1,490.00 million or 10.45% when compared to the same quarter last year. Despite an increase in cash flow, COSTCO WHOLESALE CORP's average is still marginally south of the industry average growth rate of 13.02%.
  • The current debt-to-equity ratio, 0.42, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that COST's debt-to-equity ratio is low, the quick ratio, which is currently 0.57, displays a potential problem in covering short-term cash needs.
  • COSTCO WHOLESALE CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, COSTCO WHOLESALE CORP increased its bottom line by earning $4.63 versus $3.90 in the prior year. For the next year, the market is expecting a contraction of 0.9% in earnings ($4.59 versus $4.63).

TheStreet Ratings team rates JUNIPER NETWORKS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate JUNIPER NETWORKS INC (JNPR) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

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

  • JNPR's revenue growth has slightly outpaced the industry average of 0.4%. Since the same quarter one year prior, revenues slightly increased by 6.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although JNPR's debt-to-equity ratio of 0.20 is very low, it is currently higher than that of the industry average. To add to this, JNPR has a quick ratio of 2.02, which demonstrates the ability of the company to cover short-term liquidity needs.
  • JUNIPER NETWORKS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, JUNIPER NETWORKS INC increased its bottom line by earning $0.86 versus $0.36 in the prior year. This year, the market expects an improvement in earnings ($1.50 versus $0.86).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 125.8% when compared to the same quarter one year prior, rising from $97.90 million to $221.10 million.

This article was written by a staff member of TheStreet.

More from Stocks

Danica Patrick's Final Race at 2018 Indianapolis 500: What She Thinks About Cars

Danica Patrick's Final Race at 2018 Indianapolis 500: What She Thinks About Cars

Why The FANG Stocks' Dominance May Not Be So Bad For The Market

Why The FANG Stocks' Dominance May Not Be So Bad For The Market

At End of May, Investors Signalling They May Stay Away

At End of May, Investors Signalling They May Stay Away

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever