Yadkin Valley Financial Corporation Stock Upgraded (YAVY)

NEW YORK ( TheStreet) -- Yadkin Valley Financial Corporation (Nasdaq: YAVY) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, attractive valuation levels, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • Powered by its strong earnings growth of 144.82% and other important driving factors, this stock has surged by 41.08% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, YAVY should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • 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 154.4% when compared to the same quarter one year prior, rising from -$20.21 million to $11.00 million.
  • The gross profit margin for YADKIN VALLEY FINANCIAL CORP is currently very high, coming in at 71.90%. It has increased significantly from the same period last year. Along with this, the net profit margin of 45.50% significantly outperformed against the industry average.
  • 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 on the basis of return on equity, YADKIN VALLEY FINANCIAL CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.

Yadkin Valley Financial Corporation operates as the holding company for Yadkin Valley Bank and Trust Company that provides consumer and commercial banking services in North Carolina and South Carolina. The company has a P/E ratio of 2.6, below the average banking industry P/E ratio of 2.7 and below the S&P 500 P/E ratio of 17.7. Yadkin Valley Financial has a market cap of $52.2 million and is part of the financial sector and banking industry. Shares are up 62.1% year to date as of the close of trading on Wednesday.

You can view the full Yadkin Valley Financial Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.