NEW YORK ( TheStreet) -- United Fire & Casualty CO (Nasdaq: UFCS) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity. Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 5.0%. Since the same quarter one year prior, revenues rose by 27.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 85.9% when compared to the same quarter one year prior, rising from $9.09 million to $16.89 million.
- Compared to where it was trading one year ago, UFCS is down 0.21% to its most recent closing price of 19.74. Looking ahead, our view is that this company's fundamentals give it good potential for further appreciation.
- UNITED FIRE GROUP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, UNITED FIRE GROUP INC reported lower earnings of $0.00 versus $1.71 in the prior year. This year, the market expects an increase in earnings to $0.85 from $0.00.
- The gross profit margin for UNITED FIRE GROUP INC is currently extremely low, coming in at 11.60%. Regardless of UFCS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, UFCS's net profit margin of 8.80% compares favorably to the industry average.
-- Written by a member of TheStreet RatingsStaff