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Rating Change Detail - CERADYNE, INC. (CRDN) - 3/11/2010
The stock was downgraded from Some Interest to No Interest on 3/11/2010 by the Price/Sales Investor Strategy based on the principles of Kenneth Fisher. The score according to this strategy fell from 80% to 58%. A full detailed analysis of CRDN using this strategy is included below. For a full detailed analysis of CRDN using 12 proven strategies of Wall Street Legends, take a free trial to Validea.com

Detailed Analysis of CERADYNE, INC. (CRDN)

Strategy: Price/Sales Investor - Based on: Kenneth Fisher

PRICE/SALES RATIO: [FAIL]

The prospective company should have a low Price/Sales ratio. Non-cyclical companies with Price/Sales ratios greater than 1.5 and less than 3 should not be purchased. CRDN's P/S ratio of 1.51 based on trailing 12 month sales, is above 1.5. If you are currently holding this stock, the P/S ratio is O.K., but if you are thinking about purchasing it, the stock would fail this methodology's first criterion.

TOTAL DEBT/EQUITY RATIO: [PASS]

Less debt equals less risk according to this methodology. CRDN's Debt/Equity of 12.65% is acceptable, thus passing the test.

PRICE/RESEARCH RATIO: [PASS]

This methodology considers companies in the Technology and Medical sectors to be attractive if they have low Price/Research ratios. CRDN is neither a Technology nor Medical company. Therefore the Price/Research ratio is not available and, hence, not much emphasis should be placed on this particular variable.

PRELIMINARY GRADE: No Interest in CRDN At this Point
Is CRDN a "Super Stock"? NO

Price/Sales Ratio: [FAIL]

The Price/Sales ratio is the most important variable according to this methodology. The prospective company should have a low Price/Sales ratio. CRDN's Price/Sales ratio of 1.51 does not pass this criterion.

LONG-TERM EPS GROWTH RATE: [FAIL]

This methodology looks for companies that have an inflation adjusted EPS growth rate greater than 15%. CRDN's inflation adjusted EPS growth rate of -19.54% does not pass this test.

FREE CASH PER SHARE: [PASS]

This methodology looks for companies that have a positive free cash per share. Companies should have enough free cash available to sustain three years of losses. This is based on the premise that companies without cash will soon be out of business. CRDN's free cash per share of 2.06 passes this criterion.

THREE YEAR AVERAGE NET PROFIT MARGIN: [PASS]

This methodology looks for companies that have an average net profit margin of 5% or greater over a three year period. CRDN's three year net profit margin, which averages 12.09%, passes this criterion.

For a full detailed analysis of CRDN using 12 proven strategies of Wall Street Legends,
take a free trial to Validea.com

Rating Change Detail - CERADYNE, INC. (CRDN) - 3/11/2010

Detailed Analysis of CERADYNE, INC. (CRDN)

Strategy: Price/Sales Investor - Based on: Kenneth Fisher