NEW YORK ( TheStreet) -- Hampden Bancorp (Nasdaq: HBNK) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations, expanding profit margins, solid stock price performance and impressive record of earnings per share growth. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • HAMPDEN BANCORP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. 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, HAMPDEN BANCORP INC swung to a loss, reporting -$0.04 versus $0.05 in the prior year. This year, the market expects an improvement in earnings ($0.32 versus -$0.04).
  • Powered by its strong earnings growth of 180.00% and other important driving factors, this stock has surged by 25.35% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • The gross profit margin for HAMPDEN BANCORP INC is rather high; currently it is at 69.00%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 6.80% trails the industry average.
  • Net operating cash flow has significantly increased by 4871.87% to $3.18 million when compared to the same quarter last year. In addition, HAMPDEN BANCORP INC has also vastly surpassed the industry average cash flow growth rate of -597.19%.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 173.3% when compared to the same quarter one year prior, rising from -$0.67 million to $0.49 million.

Hampden Bancorp, Inc. operates as the holding company for Hampden Bank that provides various banking and financial services to individuals and small businesses in Hampden County, Massachusetts. The company has a P/E ratio of 52.1, equal to the average banking industry P/E ratio and above the S&P 500 P/E ratio of 17.5. Hampden has a market cap of $85 million and is part of the financial sector and banking industry. The stock last closed at $12.50 and the average volume of shares traded for Hampden has been 5,400 shares per day over the past 30 days. Shares are up 11.2% year to date as of the close of trading on Monday.

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