Analysts' Actions: LinkedIn, Comerica, K12, Tableau Software, More

TheStreet Staff
August 5, 2014

NEW YORK (TheStreet) -- RATINGS CHANGES

Comerica was upgraded to neutral from negative at Susquehanna. $49 12-month price target. The bank posted better-than-expected earnings per share on Monday, driven by net interest income up 1.5% sequentially and net interest margin up 1 basis point sequentially, beating forecasts by 8 bps, Susquehanna said.

Tableau Software was initiated as a sell at TheStreet Ratings.

Read More: Disney, Groupon, Tidewater, Take-Two Continue Stream of Earnings

LinkedIn was upgraded to hold at TheStreet Ratings.

K12 was downgraded to hold from buy at Stifel. $26 12-month price target. Pressures in Pennsylvania will reduce the amount of outsourced resources and lower the volume of business, said Stifel.

Pike was downgraded to hold at BB&T Capital Markets. The company announced its plan to go private in 4Q2014, said BB&T.

Read More: Greenberg: Why Michael Kors Should Stop Giving Guidance

Xylem was downgraded to hold at TheStreet Ratings. 

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.

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Read More: Abercrombie Is Seen on the Recovery Road


TheStreet Ratings team rates LINKEDIN CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate LINKEDIN CORP (LNKD) 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, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself."

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

  • The revenue growth greatly exceeded the industry average of 11.5%. Since the same quarter one year prior, revenues rose by 46.8%. 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.
  • LNKD has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 3.69, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has slightly increased to $128.44 million or 3.43% when compared to the same quarter last year. Despite an increase in cash flow, LINKEDIN CORP's cash flow growth rate is still lower than the industry average growth rate of 17.70%.
  • 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 Internet Software & Services industry. The net income has significantly decreased by 127.7% when compared to the same quarter one year ago, falling from $3.73 million to -$1.03 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Internet Software & Services industry and the overall market, LINKEDIN CORP's return on equity significantly trails that of both the industry average and the S&P 500.