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) -- Oceanfirst Financial (Nasdaq: OCFC) 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, revenue growth, expanding profit margins, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- OCFC's revenue growth trails the industry average of 29.8%. Since the same quarter one year prior, revenues slightly increased by 1.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The gross profit margin for OCEANFIRST FINANCIAL CORP is currently very high, coming in at 90.69%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.82% is above that of the industry average.
- OCEANFIRST FINANCIAL CORP has improved earnings per share by 7.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, OCEANFIRST FINANCIAL CORP reported lower earnings of $0.95 versus $1.12 in the prior year. This year, the market expects an improvement in earnings ($1.26 versus $0.95).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Thrifts & Mortgage Finance industry. The net income increased by 6.1% when compared to the same quarter one year prior, going from $4.44 million to $4.71 million.