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) -- Park Sterling (Nasdaq: PSTB) 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, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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- PSTB's very impressive revenue growth greatly exceeded the industry average of 0.2%. Since the same quarter one year prior, revenues leaped by 177.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PARK STERLING CORP 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 year. We feel that this trend should continue. During the past fiscal year, PARK STERLING CORP continued to lose money by earning -$0.29 versus -$0.33 in the prior year. This year, the market expects an improvement in earnings ($0.19 versus -$0.29).
- 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 145.1% when compared to the same quarter one year prior, rising from -$1.38 million to $0.62 million.
- The gross profit margin for PARK STERLING CORP is currently very high, coming in at 90.10%. It has increased significantly from the same period last year. Despite the strong results of the gross profit margin, PSTB's net profit margin of 4.20% significantly trails the industry average.
- Net operating cash flow has increased to $2.26 million or 38.24% when compared to the same quarter last year. Despite an increase in cash flow, PARK STERLING CORP's cash flow growth rate is still lower than the industry average growth rate of 83.11%.
-- Written by a member of TheStreet Ratings Staff