NEW YORK ( TheStreet) -- Pacific Capital Bancorp (Nasdaq: PCBC) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and notable return on equity. However, as a counter to these strengths, we find that the stock itself is trading at a premium valuation. Highlights from the ratings report include:
- PCBC's revenue growth has slightly outpaced the industry average of 0.6%. Since the same quarter one year prior, revenues slightly increased by 1.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for PACIFIC CAPITAL BANCORP is currently very high, coming in at 88.10%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 20.70% significantly outperformed against the industry average.
- PACIFIC CAPITAL BANCORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, PACIFIC CAPITAL BANCORP turned its bottom line around by earning $2.14 versus -$322.34 in the prior year.
- Compared to its closing price of one year ago, PCBC's share price has jumped by 49.72%, exceeding the performance of the broader market during that same time frame. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.
-- Written by a member of TheStreet RatingsStaff