SunTrust Banks Inc Stock Buy Recommendation Reiterated (STI)

Editor's Note: 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.

NEW YORK ( TheStreet) -- SunTrust Banks (NYSE: STI) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

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Highlights from the ratings report include:
  • STI's very impressive revenue growth greatly exceeded the industry average of 30.5%. Since the same quarter one year prior, revenues leaped by 63.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 407.69% and other important driving factors, this stock has surged by 30.77% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • SUNTRUST BANKS 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, SUNTRUST BANKS INC turned its bottom line around by earning $0.93 versus -$0.17 in the prior year. This year, the market expects an improvement in earnings ($3.56 versus $0.93).
  • 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 400.9% when compared to the same quarter one year prior, rising from $215.00 million to $1,077.00 million.

SunTrust Banks, Inc. operates as the holding company for SunTrust Bank, which provides various financial services in the United States. SunTrust Banks has a market cap of $14.1 billion and is part of the financial sector and banking industry. The company has a P/E ratio of 8.5, below the S&P 500 P/E ratio of 17.7. Shares are up 47.9% year to date as of the close of trading on Wednesday.

You can view the full SunTrust Banks Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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