NEW YORK ( TheStreet) -- Mutualfirst Financial (Nasdaq: MFSF) 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, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- MUTUALFIRST FINANCIAL INC's earnings per share declined by 5.3% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, MUTUALFIRST FINANCIAL INC increased its bottom line by earning $0.69 versus $0.21 in the prior year. For the next year, the market is expecting a contraction of 42.8% in earnings ($0.40 versus $0.69).
- Despite the weak revenue results, MFSF has outperformed against the industry average of 35.4%. Since the same quarter one year prior, revenues slightly dropped by 7.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Thrifts & Mortgage Finance industry and the overall market on the basis of return on equity, MUTUALFIRST FINANCIAL 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 MUTUALFIRST FINANCIAL INC is rather high; currently it is at 63.80%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.80% is above that of the industry average.
- Compared to its closing price of one year ago, MFSF's share price has jumped by 25.06%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MFSF should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.