How Will MB Financial (MBFI) Stock React Today To This Ratings Upgrade?

NEW YORK (TheStreet) -- DA Davidson upgraded MB Financial (MBFI) to 'buy' from 'neutral' with a price target of $33. 

The firm's current price target of $33 is up from their previous price objective of $31. The price objective suggests a potential upside of 14.98% from the company's current price.

Shares of the financial services firm are higher by 49 cents to $28.71 in pre-market trading.

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TheStreet Ratings team rates MB FINANCIAL INC/MD as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate MB FINANCIAL INC/MD (MBFI) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations, attractive valuation levels and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for MB FINANCIAL INC/MD is currently very high, coming in at 97.13%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 20.44% is above that of the industry average.
  • Net operating cash flow has increased to $69.24 million or 10.76% when compared to the same quarter last year. In addition, MB FINANCIAL INC/MD has also vastly surpassed the industry average cash flow growth rate of -97.33%.
  • Despite the weak revenue results, MBFI has outperformed against the industry average of 12.9%. Since the same quarter one year prior, revenues slightly dropped by 1.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.
  • You can view the full analysis from the report here: MBFI Ratings Report
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