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 (
-- State Street
) 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 solid stock price performance, attractive valuation levels, expanding profit margins, good cash flow from operations and notable return on equity. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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Highlights from the ratings report include:
- Compared to its closing price of one year ago, STT's share price has jumped by 32.93%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, STT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The gross profit margin for STATE STREET CORP is currently very high, coming in at 95.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.30% is above that of the industry average.
- STATE STREET CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, STATE STREET CORP increased its bottom line by earning $3.79 versus $3.08 in the prior year. This year, the market expects an improvement in earnings ($3.83 versus $3.79).
- Net operating cash flow has slightly increased to -$2,764.00 million or 8.65% when compared to the same quarter last year. Despite an increase in cash flow of 8.65%, STATE STREET CORP is still growing at a significantly lower rate than the industry average of 80.34%.
State Street Corporation, a financial holding company, provides various financial products and services to institutional investors worldwide. The company has a P/E ratio of 11.5, equal to the average banking industry P/E ratio and below the S&P 500 P/E ratio of 17.7. State Street has a market cap of $20.29 billion and is part of the
industry. Shares are up 5.1% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.
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