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) -- PrivateBancorp (Nasdaq: PVTB) 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, compelling growth in net income, revenue growth, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
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- PRIVATEBANCORP 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, PRIVATEBANCORP INC turned its bottom line around by earning $0.43 versus -$0.18 in the prior year. This year, the market expects an improvement in earnings ($0.88 versus $0.43).
- 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 71.4% when compared to the same quarter one year prior, rising from $13.45 million to $23.05 million.
- PVTB's revenue growth trails the industry average of 14.8%. Since the same quarter one year prior, revenues slightly increased by 2.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for PRIVATEBANCORP INC is currently very high, coming in at 79.90%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 15.38% trails the industry average.
- Powered by its strong earnings growth of 92.85% and other important driving factors, this stock has surged by 83.37% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
-- Written by a member of TheStreet Ratings Staff