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) -- Heritage Financial Group (Nasdaq: HBOS) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and robust revenue growth. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.
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- Powered by its strong earnings growth of 45.16% and other important driving factors, this stock has surged by 41.34% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- HERITAGE FINANCIAL GP INC has improved earnings per share by 45.2% 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. This trend suggests that the performance of the business is improving. During the past fiscal year, HERITAGE FINANCIAL GP INC increased its bottom line by earning $1.51 versus $0.85 in the prior year. This year, the market expects an improvement in earnings ($1.60 versus $1.51).
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Thrifts & Mortgage Finance industry and the overall market on the basis of return on equity, HERITAGE FINANCIAL GP INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Thrifts & Mortgage Finance industry average, but is greater than that of the S&P 500. The net income increased by 40.2% when compared to the same quarter one year prior, rising from $2.43 million to $3.41 million.
- Net operating cash flow has significantly decreased to -$63.46 million or 1797.69% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.