3 Stocks Advancing The Financial Sector

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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 30 points (0.2%) at 17,107 as of Tuesday, Aug. 26, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 2,006 issues advancing vs. 1,020 declining with 179 unchanged.

The Financial sector as a whole closed the day up 0.3% versus the S&P 500, which was up 0.1%. Top gainers within the Financial sector included Valley Financial ( VYFC), up 4.9%, Porter Bancorp ( PBIB), up 2.1%, Vestin Realty Mortgage I ( VRTA), up 2.0%, Mackinac Financial ( MFNC), up 4.5% and Oconee Federal Financial ( OFED), up 1.9%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the sector higher today:

Mackinac Financial ( MFNC) is one of the companies that pushed the Financial sector higher today. Mackinac Financial was up $0.49 (4.5%) to $11.49 on heavy volume. Throughout the day, 7,319 shares of Mackinac Financial exchanged hands as compared to its average daily volume of 1,700 shares. The stock ranged in a price between $11.38-$11.68 after having opened the day at $11.38 as compared to the previous trading day's close of $11.00.

Mackinac Financial Corporation operates as the holding company for mBank that provides commercial and retail banking products and services. Mackinac Financial has a market cap of $65.2 million and is part of the insurance industry. Shares are up 11.1% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Mackinac Financial a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Mackinac Financial as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share and unimpressive growth in net income.

Highlights from TheStreet Ratings analysis on MFNC go as follows:

  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, our view is that this company's fundamentals will 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.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.7%. Since the same quarter one year prior, revenues slightly dropped by 3.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • MACKINAC FINANCIAL CORP's earnings per share declined by 31.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, MACKINAC FINANCIAL CORP reported lower earnings of $1.00 versus $1.66 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Commercial Banks industry. The net income has significantly decreased by 36.0% when compared to the same quarter one year ago, falling from $1.26 million to $0.81 million.

You can view the full analysis from the report here: Mackinac Financial Ratings Report

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At the close, Porter Bancorp ( PBIB) was up $0.02 (2.1%) to $0.99 on light volume. Throughout the day, 3,600 shares of Porter Bancorp exchanged hands as compared to its average daily volume of 15,400 shares. The stock ranged in a price between $0.99-$0.99 after having opened the day at $0.99 as compared to the previous trading day's close of $0.97.

Porter Bancorp, Inc. operates as the bank holding company for PBI Bank that provides commercial and personal banking products and services, and financial services in Central Kentucky and Louisville. Porter Bancorp has a market cap of $13.0 million and is part of the insurance industry. Shares are down 3.9% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Porter Bancorp a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Porter Bancorp as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on PBIB go as follows:

  • PBIB's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 34.49%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • PBIB, with its decline in revenue, slightly underperformed the industry average of 11.7%. Since the same quarter one year prior, revenues fell by 16.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for PORTER BANCORP INC is currently very high, coming in at 77.04%. Regardless of PBIB's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PBIB's net profit margin of 0.38% is significantly lower than the industry average.
  • PORTER BANCORP INC 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, PORTER BANCORP INC continued to lose money by earning -$0.28 versus -$2.83 in the prior year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 103.3% when compared to the same quarter one year prior, rising from -$1.31 million to $0.04 million.

You can view the full analysis from the report here: Porter Bancorp Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Valley Financial ( VYFC) was another company that pushed the Financial sector higher today. Valley Financial was up $0.58 (4.9%) to $12.40 on light volume. Throughout the day, 400 shares of Valley Financial exchanged hands as compared to its average daily volume of 1,100 shares. The stock ranged in a price between $12.40-$12.41 after having opened the day at $12.41 as compared to the previous trading day's close of $11.82.

Valley Financial Corporation operates as the holding company for Valley Bank that provides general commercial and retail banking services to small-to-medium sized businesses, professional concerns, and individuals primarily in the Roanoke Valley of Virginia. Valley Financial has a market cap of $59.6 million and is part of the insurance industry. Shares are up 12.0% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Valley Financial a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Valley Financial as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share and increase in stock price during the past year. However, as a counter to these strengths, we find that net income has been generally deteriorating over time.

Highlights from TheStreet Ratings analysis on VYFC go as follows:

  • The revenue growth came in higher than the industry average of 11.7%. Since the same quarter one year prior, revenues rose by 11.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • VALLEY FINANCIAL CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, VALLEY FINANCIAL CORP increased its bottom line by earning $1.26 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.28 versus $1.26).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, VALLEY FINANCIAL CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • The gross profit margin for VALLEY FINANCIAL CORP is currently very high, coming in at 78.81%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, VYFC's net profit margin of 17.14% compares favorably to the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Commercial Banks industry average. The net income has decreased by 9.5% when compared to the same quarter one year ago, dropping from $1.93 million to $1.74 million.

You can view the full analysis from the report here: Valley Financial Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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.

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