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NEW YORK (TheStreet) -- Hometrust Bancshares (HTBI) has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate HOMETRUST BANCSHARES INC (HTBI) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and relatively poor performance when compared with the S&P 500 during the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 4.7%. Since the same quarter one year prior, revenues rose by 39.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for HOMETRUST BANCSHARES INC is currently very high, coming in at 94.38%. Regardless of HTBI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HTBI's net profit margin of 8.40% is significantly lower than the industry average.
- HOMETRUST BANCSHARES INC's earnings per share declined by 33.3% 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, HOMETRUST BANCSHARES INC increased its bottom line by earning $0.54 versus $0.45 in the prior year. For the next year, the market is expecting a contraction of 3.7% in earnings ($0.52 versus $0.54).
- 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 28.8% when compared to the same quarter one year ago, falling from $2.88 million to $2.05 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, HOMETRUST BANCSHARES INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
- You can view the full analysis from the report here: HTBI Ratings Report