NEW YORK ( TheStreet) -- Investors Bancorp (Nasdaq: ISBC) 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, impressive record of earnings per share growth, expanding profit margins, notable return on equity and compelling growth in net income. 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, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Commercial Banks industry average, but is greater than that of the S&P 500. The net income increased by 28.4% when compared to the same quarter one year prior, rising from $15.28 million to $19.62 million.
- 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 Commercial Banks industry and the overall market on the basis of return on equity, INVESTORS 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 INVESTORS BANCORP INC is rather high; currently it is at 55.90%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ISBC's net profit margin of 15.80% significantly trails the industry average.
- INVESTORS BANCORP INC has improved earnings per share by 28.6% 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, INVESTORS BANCORP INC increased its bottom line by earning $0.57 versus $0.22 in the prior year. This year, the market expects an improvement in earnings ($0.70 versus $0.57).
- The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 12.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.