NEW YORK (
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- RBCAA's revenue growth trails the industry average of 20.7%. Since the same quarter one year prior, revenues slightly increased by 1.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- 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. In comparison to the other companies in the Commercial Banks industry and the overall market, REPUBLIC BANCORP INC/KY's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
- REPUBLIC BANCORP INC/KY's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, REPUBLIC BANCORP INC/KY increased its bottom line by earning $3.10 versus $2.03 in the prior year. This year, the market expects an improvement in earnings ($4.28 versus $3.10).
- RBCAA has underperformed the S&P 500 Index, declining 22.15% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- Net operating cash flow has significantly decreased to -$19.23 million or 296.67% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
Republic Bancorp, Inc. operates as the holding company for Republic Bank & Trust Company and Republic Bank, which provides banking, tax refund solutions, and mortgage banking services to individuals and businesses in the United States. The company has a P/E ratio of four, equal to the average banking industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Republic has a market cap of $325.1 million and is part of the
industry. Shares are down 28.6% year to date as of the close of trading on Friday.
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