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NEW YORK (TheStreet) -- First Internet Bancorp (INBK - Get Report) has been upgraded by TheStreet Ratings from Hold to Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate FIRST INTERNET BANCORP (INBK) a BUY. This is driven by a number of 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 revenue growth, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 9.2%. Since the same quarter one year prior, revenues rose by 22.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- 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 76.3% when compared to the same quarter one year prior, rising from $0.73 million to $1.28 million.
- The gross profit margin for FIRST INTERNET BANCORP is currently very high, coming in at 78.14%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 12.96% trails the industry average.
- FIRST INTERNET BANCORP has improved earnings per share by 12.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, FIRST INTERNET BANCORP reported lower earnings of $1.54 versus $1.96 in the prior year. For the next year, the market is expecting a contraction of 50.1% in earnings ($0.77 versus $1.54).
- INBK'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 45.49%, 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. Although its share price is down sharply from a year ago and the fact that INBK is still more expensive than most of the other companies in its industry based on its current price-to-earnings ratio, we believe that other strengths that the company offers support our buy rating.
- You can view the full analysis from the report here: INBK Ratings Report