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) -- Republic First Bancorp (Nasdaq: FRBK) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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- FRBK's revenue growth has slightly outpaced the industry average of 1.9%. Since the same quarter one year prior, revenues slightly increased by 1.1%. 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.
- Compared to its closing price of one year ago, FRBK's share price has jumped by 42.71%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- The gross profit margin for REPUBLIC FIRST BANCORP INC is currently very high, coming in at 89.00%. Regardless of FRBK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FRBK's net profit margin of 8.74% is significantly lower than 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. When compared to other companies in the Commercial Banks industry and the overall market, REPUBLIC FIRST BANCORP INC's return on equity is below that of both the industry average and the S&P 500.
- REPUBLIC FIRST BANCORP INC's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, REPUBLIC FIRST BANCORP INC turned its bottom line around by earning $0.14 versus -$0.96 in the prior year. For the next year, the market is expecting a contraction of 10.7% in earnings ($0.13 versus $0.14).
-- Written by a member of TheStreet Ratings Staff