NEW YORK (TheStreet) -- Regions Financial (RF - Get Report) shares are down -2.2% to $10.20 after having coverage initiated with a "neutral" rating by analysts at Nomura (NMR - Get Report) on Wednesday.
The firm set a price target of $11 on the company's shares, suggesting a 6% increase from the stock's opening price today.
TheStreet Ratings team rates REGIONS FINANCIAL CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate REGIONS FINANCIAL CORP (RF) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for REGIONS FINANCIAL CORP is currently very high, coming in at 93.71%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.89% is above that of the industry average.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- REGIONS FINANCIAL CORP's earnings per share declined by 8.7% in the most recent quarter compared to 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, REGIONS FINANCIAL CORP increased its bottom line by earning $0.78 versus $0.75 in the prior year. This year, the market expects an improvement in earnings ($0.86 versus $0.78).
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.0%. Since the same quarter one year prior, revenues slightly dropped by 5.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- 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. When compared to other companies in the Commercial Banks industry and the overall market, REGIONS FINANCIAL CORP's return on equity is below that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: RF Ratings Report