Credit Suisse Upgrades Suncoke Energy (SXC) to Outperform

Tickers in this article: SXC

NEW YORK (TheStreet) -- Credit Suisse upgraded Suncoke Energy  to "outperform" from "neutral" and set a target price of $24. The firm said that the company has multiple potential catalysts for 2014.

The stock closed at $21.85 on Thursday.

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

"We rate SUNCOKE ENERGY INC (SXC) 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 good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and generally higher debt management risk."

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

  • Net operating cash flow has significantly increased by 84.26% to -$1.40 million when compared to the same quarter last year. In addition, SUNCOKE ENERGY INC has also vastly surpassed the industry average cash flow growth rate of -4.59%.
  • SXC, with its decline in revenue, underperformed when compared the industry average of 3.2%. Since the same quarter one year prior, revenues fell by 18.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for SUNCOKE ENERGY INC is rather low; currently it is at 18.90%. Regardless of SXC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, SXC's net profit margin of 1.58% is significantly lower than the industry average.
  • 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 Metals & Mining industry. The net income has significantly decreased by 80.4% when compared to the same quarter one year ago, falling from $31.60 million to $6.20 million.
  • You can view the full analysis from the report here: SXC Ratings Report