Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its increase in net income, increase in stock price during the past year and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Commercial Banks industry average. The net income increased by 13.1% when compared to the same quarter one year prior, going from $830.00 million to $939.00 million.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- PNC FINANCIAL SVCS GROUP INC has improved earnings per share by 5.8% 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, PNC FINANCIAL SVCS GROUP INC increased its bottom line by earning $5.64 versus $4.99 in the prior year. For the next year, the market is expecting a contraction of 0.5% in earnings ($5.61 versus $5.64).
- 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, PNC FINANCIAL SVCS GROUP INC's return on equity is below that of both the industry average and the S&P 500.
The PNC Financial Services Group, Inc. operates as a diversified financial services company in the United States and internationally. The company's Retail Banking segment provides deposit, lending, brokerage, investment management, and cash management services. PNC Financial Services Group has a market cap of $30.58 billion and is part of the financial sector and banking industry. The company has a P/E ratio of 9.9, below the S&P 500 P/E ratio of 17.7. Shares are up 0.2% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.
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