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 (
(NYSE:) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and attractive valuation levels. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.
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Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 0.7%. Since the same quarter one year prior, revenues rose by 32.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 178.6% when compared to the same quarter one year prior, rising from $789.00 million to $2,198.00 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Insurance industry and the overall market on the basis of return on equity, PRUDENTIAL FINANCIAL INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- PRU's debt-to-equity ratio of 0.94 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further.
- The gross profit margin for PRUDENTIAL FINANCIAL INC is currently lower than what is desirable, coming in at 34.80%. Regardless of PRU's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, PRU's net profit margin of 13.60% compares favorably to the industry average.
Prudential Financial, Inc., through its subsidiaries, provides various financial products and services, including life insurance, annuities, retirement-related services, mutual funds, and investment management services in the United States, Asia, Europe, and Latin America. The company has a P/E ratio of 7.7, equal to the average insurance industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Prudential Financial has a market cap of $24.88 billion and is part of the sector and industry. Shares are up 9.6% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.