Banc of California Upped to Strong Buy - Analyst Blog
October 10 2013 - 11:00AM
Zacks
On Oct 8, Zacks Investment Research upgraded Banc of
California, Inc. (BANC) to a Zacks Rank #1 (Strong
Buy).
Why the Upgrade?
Banc of California has been witnessing rising earnings estimates on
the back of strong second-quarter 2013 results and the recent
acquisition of Calif.-based The Palisades Group, LLC. Moreover,
this well-known retail banking services provider recorded a
year-to-date return of 11.6%. The long-term expected earnings
growth rate for this stock is 15%.
Banc of California reported its second-quarter results on Aug 7
with earnings per share of 36 cents, beating the Zacks Consensus
Estimate of 23 cents by 56.5% and the year-ago loss of 9 cents.
Robust results for the reported quarter were primarily driven by
organic growth, which reflected an elevated top line along with
increased loans and deposits. Yet, these positives were partially
offset by higher provisions for loan losses and augmented
non-interest expenses.
Recently, Banc of California completed the sale of its eight legacy
branches to Wash. -based AmericanWest Bank. This move will
facilitate the bank in focusing on retail branch network in Los
Angeles, Orange and San Diego counties.
Additionally, in September, Banc of California completed the
acquisition of Palisades, which provides financial advisory and
asset management services. As of Jun 30, 2013, Palisades had assets
under management of about $1.7 billion.
Following second-quarter 2013 results and the recent restructuring,
the Zacks Consensus Estimate for 2013 increased 17.9% to $1.58 per
share, over the last 60 days. For 2014, the Zacks Consensus
Estimate advanced 5.6% to $1.52 per share over the same time
period.
Other Stocks to Consider
Besides Banc of California, other banks in the same sector that are
worth considering include Cullen/Frost Bankers,
Inc. (CFR) with a Zacks Rank #1, while Prosperity
Bancshares Inc. (PB) and BofI Holding,
Inc. (BOFI) carry a Zacks Rank #2 (Buy).
BANC OF CA INC (BANC): Free Stock Analysis Report
BOFI HLDG INC (BOFI): Free Stock Analysis Report
CULLEN FROST BK (CFR): Free Stock Analysis Report
PROSPERITY BCSH (PB): Free Stock Analysis Report
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