NEW YORK ( TheStreet) -- Susquehanna (Nasdaq: SUSQ) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its 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:
- SUSQUEHANNA BANCSHARES 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. We feel that this trend should continue. During the past fiscal year, SUSQUEHANNA BANCSHARES INC increased its bottom line by earning $0.41 versus $0.15 in the prior year. This year, the market expects an improvement in earnings ($0.73 versus $0.41).
- The gross profit margin for SUSQUEHANNA BANCSHARES INC is rather high; currently it is at 67.80%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, SUSQ's net profit margin of 10.30% significantly trails the industry average.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 12.5%. Since the same quarter one year prior, revenues slightly dropped by 3.2%. 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. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, SUSQUEHANNA BANCSHARES INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
- 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 47.5% when compared to the same quarter one year prior, rising from $12.97 million to $19.13 million.
-- Written by a member of TheStreet RatingsStaff