Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. NEW YORK ( TheStreet) -- Bank Mutual Corporation (Nasdaq: BKMU) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, reasonable valuation levels, expanding profit margins and notable return on equity. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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- Powered by its strong earnings growth of 100.00% and other important driving factors, this stock has surged by 40.97% 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.
- BANK MUTUAL 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 two years. We feel that this trend should continue. During the past fiscal year, BANK MUTUAL CORP turned its bottom line around by earning $0.15 versus -$1.04 in the prior year. This year, the market expects an improvement in earnings ($0.21 versus $0.15).
- The gross profit margin for BANK MUTUAL CORP is currently very high, coming in at 80.84%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, BKMU's net profit margin of 9.94% significantly trails the industry average.
- The revenue fell significantly faster than the industry average of 39.7%. Since the same quarter one year prior, revenues slightly dropped by 5.0%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.