NEW YORK (TheStreet) --BOK Financial Corp. (BOKF) was downgraded to "underperform" from "market perform" at BMO Capital Tuesday because the firm believes the bank will encounter near-term earnings pressure.
Currently, BMO has a $61.00 price target on the stock, which points to a potential downside of 12.12% from the financial holding company's current price.
TheStreet Ratings team rates BOK FINANCIAL CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate BOK FINANCIAL CORP (BOKF) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for BOK FINANCIAL CORP is currently very high, coming in at 98.34%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 22.10% significantly outperformed against the industry average.
- Net operating cash flow has increased to $167.36 million or 16.86% when compared to the same quarter last year. Despite an increase in cash flow of 16.86%, BOK FINANCIAL CORP is still growing at a significantly lower rate than the industry average of 409.51%.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 12.1%. Since the same quarter one year prior, revenues slightly dropped by 7.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, BOK FINANCIAL CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- You can view the full analysis from the report here: BOKF Ratings Report