NEW YORK ( TheStreet) -- Virginia Commerce Bancorp (Nasdaq: VCBI) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, attractive valuation levels, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, VIRGINIA COMM BANCORP INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- The gross profit margin for VIRGINIA COMM BANCORP INC is rather high; currently it is at 58.80%. 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 13.50% trails the industry average.
- VIRGINIA COMM BANCORP INC has improved earnings per share by 9.1% 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, VIRGINIA COMM BANCORP INC turned its bottom line around by earning $0.57 versus -$1.42 in the prior year. This year, the market expects an improvement in earnings ($0.58 versus $0.57).
- VCBI's revenue growth has slightly outpaced the industry average of 7.0%. Since the same quarter one year prior, revenues slightly increased by 1.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.