NEW YORK (
) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- ALLIANCE BANKSHARES CORP has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, ALLIANCE BANKSHARES CORP swung to a loss, reporting -$0.09 versus $0.14 in the prior year.
- 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 Commercial Banks industry. The net income has significantly decreased by 567.7% when compared to the same quarter one year ago, falling from $0.16 million to -$0.74 million.
- 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. Compared to other companies in the Commercial Banks industry and the overall market, ALLIANCE BANKSHARES CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 27.02%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 566.66% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- The gross profit margin for ALLIANCE BANKSHARES CORP is rather high; currently it is at 66.80%. Regardless of ABVA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ABVA's net profit margin of -14.80% significantly underperformed when compared to the industry average.
Alliance Bankshares Corporation operates as the holding company for Alliance Bank Corporation that provides commercial and retail banking services in the greater Washington, D.C. metropolitan region. The company has a P/E ratio of 44.2, above the average banking industry P/E ratio of 43.3 and above the S&P 500 P/E ratio of 17.7. Alliance has a market cap of $17.7 million and is part of the
industry. Shares are up 1.7% year to date as of the close of trading on Tuesday.
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-- Written by a member of TheStreet Ratings Staff