NEW YORK (TheStreet) -- First Citizens BancShares Inc (DE (Nasdaq:FCNCA) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins, good cash flow from operations, growth in earnings per share and attractive valuation levels. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 195.3% when compared to the same quarter one year prior, rising from $27.75 million to $81.94 million.
- The gross profit margin for FIRST CITIZENS BANCSH is currently very high, coming in at 75.70%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 25.00% trails the industry average.
- Net operating cash flow has significantly increased by 455.31% to $119.08 million when compared to the same quarter last year. Despite an increase in cash flow of 455.31%, FIRST CITIZENS BANCSH is still growing at a significantly lower rate than the industry average of 1240.38%.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 3.6%. Since the same quarter one year prior, revenues slightly dropped by 0.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- FIRST CITIZENS BANCSH 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, FIRST CITIZENS BANCSH increased its bottom line by earning $18.50 versus $11.14 in the prior year. For the next year, the market is expecting a contraction of 28.5% in earnings ($13.22 versus $18.50).
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