BankFinancial Corp Stock Downgraded (BFIN)

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) -- BankFinancial (Nasdaq: BFIN) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, impressive record of earnings per share growth and expanding profit margins. 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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Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Thrifts & Mortgage Finance industry average. The net income increased by 38.9% when compared to the same quarter one year prior, rising from $0.68 million to $0.94 million.
  • BANKFINANCIAL 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 year. During the past fiscal year, BANKFINANCIAL CORP turned its bottom line around by earning $0.15 versus -$1.35 in the prior year.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
  • 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 Thrifts & Mortgage Finance industry and the overall market on the basis of return on equity, BANKFINANCIAL CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Net operating cash flow has decreased to $1.45 million or 35.95% when compared to the same quarter last year. Despite a decrease in cash flow BANKFINANCIAL CORP is still fairing well by exceeding its industry average cash flow growth rate of -65.04%.

BankFinancial Corporation operates as the holding company for BankFinancial, F.S.B. that provides commercial, family, and personal banking services primarily in Illinois. BankFinancial has a market cap of $208.9 million and is part of the financial sector and banking industry. Shares are up 8.1% year to date as of the close of trading on Tuesday.

You can view the full BankFinancial Ratings Report or get investment ideas from our investment research center.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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