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) -- Royal Bancshares of Pennsylvania (Nasdaq: RBPAA) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and growth in earnings per share. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.
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- Compared to its price level of one year ago, RBPAA is up 113.76% to its most recent closing price of 2.95. Looking ahead, our view is that this company's fundamentals should not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
- The revenue growth greatly exceeded the industry average of 12.5%. Since the same quarter one year prior, revenues rose by 21.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- ROYAL BANCSHARES/PA 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. During the past fiscal year, ROYAL BANCSHARES/PA turned its bottom line around by earning $0.00 versus -$1.33 in the prior year.
- Net operating cash flow has significantly increased by 148.46% to $0.35 million when compared to the same quarter last year. In addition, ROYAL BANCSHARES/PA has also vastly surpassed the industry average cash flow growth rate of -73.81%.
- 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. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, ROYAL BANCSHARES/PA underperformed against that of the industry average and is significantly less than that of the S&P 500.