NEW YORK ( TheStreet) -- BanColombia (NYSE: CIB) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, expanding profit margins, growth in earnings per share and increase in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results. Highlights from the ratings report include:
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Commercial Banks industry. The net income increased by 4.6% when compared to the same quarter one year prior, going from $178.27 million to $186.49 million.
- BANCOLOMBIA SA's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, BANCOLOMBIA SA increased its bottom line by earning $13.50 versus $8.91 in the prior year. For the next year, the market is expecting a contraction of 65.7% in earnings ($4.64 versus $13.50).
- The gross profit margin for BANCOLOMBIA SA is currently very high, coming in at 73.40%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.00% is above that of the industry average.
- Despite its growing revenue, the company underperformed as compared with the industry average of 6.2%. Since the same quarter one year prior, revenues slightly increased by 3.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 38.48% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CIB should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.