NEW YORK (TheStreet) -- Shares of Brookdale Senior Living (BKD - Get Report) were falling 10.7% to $32.79 Monday after the long-term care facility operator announced its preliminary fourth quarter results.

Brookdale announced that it expects to report Cash From Facility Operations, excluding the roll-out costs of electronic medical records, of 53 cents a share in the fourth quarter. The company lowered its CFFO guidance for 2015 to a range of $2.60 to $2.75 a share from its previous range of $2.95 to $3.10 a share.

The company expects to report revenue of about $1.25 billion for the fourth quarter, with consolidated senior housing revenue of about $929 million. Analysts expect Brookdale to report revenue of $1.32 billion for the quarter.

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Brookdale will announce its full fourth quarter results on Jan. 28.

TheStreet Ratings team rates BROOKDALE SENIOR LIVING INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate BROOKDALE SENIOR LIVING INC (BKD) 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 robust revenue growth, solid stock price performance and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and weak operating cash flow."

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

  • The revenue growth came in higher than the industry average of 20.6%. Since the same quarter one year prior, revenues rose by 48.7%. 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 its closing price of one year ago, BKD's share price has jumped by 29.78%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • BROOKDALE SENIOR LIVING 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. 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, BROOKDALE SENIOR LIVING INC continued to lose money by earning -$0.03 versus -$0.55 in the prior year. This year, the market expects an improvement in earnings ($2.60 versus -$0.03).
  • 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 Health Care Providers & Services industry. The net income has significantly decreased by 3712.0% when compared to the same quarter one year ago, falling from -$0.97 million to -$36.86 million.
  • The debt-to-equity ratio is very high at 2.15 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.41, which clearly demonstrates the inability to cover short-term cash needs.
  • You can view the full analysis from the report here: BKD Ratings Report
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