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) -- State Street (NYSE: STT) has been reiterated by TheStreet Ratings as a buy with a ratings score of A-. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, attractive valuation levels, expanding profit margins and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
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- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 53.30% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, STT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- STATE STREET CORP has improved earnings per share by 15.3% 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, STATE STREET CORP increased its bottom line by earning $4.19 versus $3.79 in the prior year. This year, the market expects an improvement in earnings ($4.54 versus $4.19).
- The gross profit margin for STATE STREET CORP is currently very high, coming in at 95.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.22% is above that of the industry average.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Capital Markets industry average. The net income increased by 8.7% when compared to the same quarter one year prior, going from $427.00 million to $464.00 million.
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