NEW YORK ( TheStreet) -- First Financial Bankshares (Nasdaq: FFIN) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, revenue growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and premium valuation.

Highlights from the ratings report include:
  • FIRST FINL BANKSHARES INC has improved earnings per share by 14.7% 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. This trend suggests that the performance of the business is improving. During the past fiscal year, FIRST FINL BANKSHARES INC increased its bottom line by earning $1.87 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($2.12 versus $1.87).
  • FFIN's revenue growth trails the industry average of 20.1%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has increased to $19.23 million or 24.77% when compared to the same quarter last year. Despite an increase in cash flow, FIRST FINL BANKSHARES INC's cash flow growth rate is still lower than the industry average growth rate of 45.73%.
  • FFIN has underperformed the S&P 500 Index, declining 9.82% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

First Financial Bankshares, Inc., through its subsidiaries, provides commercial banking products and services primarily in Texas. The company has a P/E ratio of 14.2, above the average banking industry P/E ratio of 14 and below the S&P 500 P/E ratio of 17.7. First Financial has a market cap of $895.7 million and is part of the financial sector and banking industry. Shares are down 18.9% year to date as of the close of trading on Friday.

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