NEW YORK ( TheStreet) -- Alliance Bancorp (Nasdaq: ALLB) 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, increase in stock price during the past year and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Thrifts & Mortgage Finance industry and the overall market on the basis of return on equity, ALLIANCE BANCORP OF PA has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • ALLIANCE BANCORP OF PA reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ALLIANCE BANCORP OF PA reported lower earnings of $0.20 versus $0.24 in the prior year.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Thrifts & Mortgage Finance industry. The net income increased by 262.9% when compared to the same quarter one year prior, rising from $0.19 million to $0.68 million.

Alliance Bancorp, Inc. of Pennsylvania operates as the bank holding company for Alliance Bank that provides various savings bank services in Pennsylvania. The company has a P/E ratio of 69.5, equal to the average banking industry P/E ratio and above the S&P 500 P/E ratio of 16.7. Alliance has a market cap of $60.9 million and is part of the financial sector and banking industry. Shares are up 18% year to date as of the close of trading on Tuesday.

You can view the full Alliance Ratings Report or get investment ideas from our investment research center.
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