NEW YORK ( TheStreet) -- Union First Market Bankshares (Nasdaq: UBSH) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, expanding profit margins, good cash flow from operations, notable return on equity and increase 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:
  • UNION FIRST MARKET BANKSHARS has improved earnings per share by 13.8% 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 year. We feel that this trend should continue. During the past fiscal year, UNION FIRST MARKET BANKSHARS increased its bottom line by earning $0.82 versus $0.21 in the prior year. This year, the market expects an improvement in earnings ($1.08 versus $0.82).
  • The gross profit margin for UNION FIRST MARKET BANKSHARS is currently very high, coming in at 80.10%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, UBSH's net profit margin of 15.30% significantly trails the industry average.
  • Net operating cash flow has significantly increased by 98.91% to $17.84 million when compared to the same quarter last year. Despite an increase in cash flow of 98.91%, UNION FIRST MARKET BANKSHARS is still growing at a significantly lower rate than the industry average of 1267.83%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 3.8%. Since the same quarter one year prior, revenues slightly dropped by 2.7%. The declining revenue has not hurt the company's bottom line, with increasing 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. When compared to other companies in the Commercial Banks industry and the overall market, UNION FIRST MARKET BANKSHARS's return on equity is below that of both the industry average and the S&P 500.

Union First Market Bankshares Corporation operates as the holding company for Union First Market Bank that provides various banking products and services to retail and commercial customers in the northern, central, Rappahannock, Tidewater, and Northern Neck regions of Virginia. The company has a P/E ratio of 13.8, equal to the average banking industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Union First Market has a market cap of $337.2 million and is part of the financial sector and banking industry. Shares are down 10.8% year to date as of the close of trading on Friday.

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