Update (9:52 a.m.): Updated with Friday market open information.
KBW also upgraded Home Bancshares to "outperform" from "market perform" and set a $35 price target based on valuation.
The stock was up 2.75% to $29.49 at 9:50 a.m. on Friday.Must Read: Warren Buffett's 10 Favorite Growth Stocks STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. ---------- Separately, TheStreet Ratings team rates HOME BANCSHARES INC as a "buy" with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation: "We rate HOME BANCSHARES INC (HOMB) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, compelling growth in net income, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- HOMB's very impressive revenue growth greatly exceeded the industry average of 9.0%. Since the same quarter one year prior, revenues leaped by 65.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- HOME BANCSHARES INC has improved earnings per share by 35.5% 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. We feel that this trend should continue. During the past fiscal year, HOME BANCSHARES INC increased its bottom line by earning $1.14 versus $1.12 in the prior year. This year, the market expects an improvement in earnings ($1.81 versus $1.14).
- 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 55.8% when compared to the same quarter one year prior, rising from $17.55 million to $27.34 million.
- The gross profit margin for HOME BANCSHARES INC is currently very high, coming in at 87.47%. Regardless of HOMB's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HOMB's net profit margin of 29.07% significantly outperformed against the industry.
- Powered by its strong earnings growth of 35.48% and other important driving factors, this stock has surged by 47.15% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full analysis from the report here: HOMB Ratings Report
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV