NEW YORK (TheStreet) -- TCF Financial Corp. (TCB) was upgraded to "outperform" from "market perform" at FBR Capital on Monday, based on a recent pullback in shares and a valuation call, the firm said.
TheStreet Ratings team rates TCF FINANCIAL CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate TCF FINANCIAL CORP (TCB) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and increase in stock price during the past year. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 9.0%. Since the same quarter one year prior, revenues slightly increased by 3.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- TCF FINANCIAL CORP reported significant earnings per share improvement 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. We feel that this trend should continue. During the past fiscal year, TCF FINANCIAL CORP turned its bottom line around by earning $0.82 versus -$1.37 in the prior year. This year, the market expects an improvement in earnings ($1.11 versus $0.82).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Commercial Banks industry average. The net income increased by 49.3% when compared to the same quarter one year prior, rising from $29.97 million to $44.76 million.
- The gross profit margin for TCF FINANCIAL CORP is currently very high, coming in at 91.24%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 14.07% trails the industry average.
- In its most recent trading session, TCB has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- You can view the full analysis from the report here: TCB Ratings Report