NEW YORK ( TheStreet) -- California First National Bancorp (Nasdaq: CFNB) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins, increase in stock price during the past year, attractive valuation levels and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

California First National Bancorp operates as the holding company for California First Leasing Corp. and California First National Bank that engage in leasing and banking activities in the United States. The company has a P/E ratio of 16, equal to the average banking industry P/E ratio and below the S&P 500 P/E ratio of 23.5. California First has a market cap of $147.8 million and is part of the financial sector and banking industry. The stock last closed at $14.40 and the average volume of shares traded for California First has been 5,000 shares per day over the past 30 days. Shares are up 1.7% year to date as of the close of trading on Thursday.