NEW YORK ( TheStreet) -- Taylor Capital Group (Nasdaq: TAYC) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity and expanding profit margins. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good. Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 280.5% when compared to the same quarter one year prior, rising from -$45.61 million to $82.32 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Commercial Banks industry and the overall market, TAYLOR CAPITAL GROUP INC's return on equity exceeds that of both the industry average and the S&P 500.
- After a year of stock price fluctuations, the net result is that TAYC's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- TAYLOR CAPITAL GROUP INC reported significant earnings per share improvement 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, TAYLOR CAPITAL GROUP INC turned its bottom line around by earning $3.24 versus -$5.93 in the prior year. For the next year, the market is expecting a contraction of 73.8% in earnings ($0.85 versus $3.24).
- TAYC, with its decline in revenue, slightly underperformed the industry average of 2.6%. Since the same quarter one year prior, revenues slightly dropped by 7.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.