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) -- First Financial Bancorp (Nasdaq: FFBC) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its expanding profit margins, growth in earnings per share, increase in net income and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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- The gross profit margin for FIRST FINL BANCORP INC/OH is currently very high, coming in at 95.71%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 20.64% trails the industry average.
- FIRST FINL BANCORP INC/OH has improved earnings per share by 8.3% 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, FIRST FINL BANCORP INC/OH reported lower earnings of $0.84 versus $1.15 in the prior year. This year, the market expects an improvement in earnings ($1.15 versus $0.84).
- The net income growth from the same quarter one year ago has exceeded that of the Commercial Banks industry average, but is less than that of the S&P 500. The net income increased by 9.3% when compared to the same quarter one year prior, going from $13.82 million to $15.10 million.
- FFBC, with its decline in revenue, underperformed when compared the industry average of 2.6%. Since the same quarter one year prior, revenues fell by 18.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.