3 Bank Stocks Crushing Earnings

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As we come in to the New Year, it will be more important than ever to focus on the very best stocks in the very best sectors. The market advance is thinning out, and institutional investors are becoming much more selective about their buying. Without the buying pressure of the biggest investors, it is very difficult for a stock to work its way significantly higher.

Bank stocks are one sector that is seeing an enormous amount of buying right now. In particular, smaller bank stocks are seeing enormous fundamental improvements as the credit and real estate crises continue to fade into the rear-view mirror. The loan problems that banks had to deal with are quickly becoming a bad memory, and business is getting back to some level of normalcy. In addition, we are seeing a consolidation trend in the sector as smaller banks join forces to deal with new regulatory costs and compete with their larger rivals like Bank of America (BAC) and Wells Fargo (WFC).

Glacier Bancorp (GBCI) is a great example of regional bank stocks attracting attention from the big money right now. The bank has 106 locations in the Northwest part of the country with branches in Montana, Idaho, Wyoming, Colorado, Utah and Washington. The company recently reported an all-time high in net income, as earnings grew more than 30% on a year-over-year basis. In addition to being one of the few small banks seeing organic loan growth, Glacier also recently closed on the acquisition of a smaller competitor in the state of Washington. The bank is firing on all cylinders right now, and this strength shows up in its ranking in Portfolio Grader. The stock was upgraded to an “A” back in August and remains a “strong buy.”

Western Alliance Bancorp (WAL) has 40 offices in Nevada, Arizona, and California and is rebounding from the hard hit that regional real estate markets suffered over the past few years. WAL is one of the few banks of its size to have survived in its home markets and is one of the few independent banks left in the greater Las Vegas area. WAL has been seeing very strong organic loan and deposit growth, and the progress is dropping right down to the bottom line. Earnings were up almost 70% on a year-over-year basis this past quarter, and analysts are raising their estimates for 2014. The strong fundamental performance was noted back in February of this year, when Portfolio Grade upgraded this bank stock to an “A.” WAL remains a “strong buy” going into the New Year.

The Southeastern real estate markets were also hit very hard in the crisis, but Fidelity Southern Corporation (LION) has come through the fire and is now on track for a huge performance in 2014. In the past year, earnings have grown by 140% — and that growth is expected to continue into next year. This bank stock has been ranked “A” in Portfolio Grader and remains a “strong buy” at the current price.

It will be very important to be in the right stocks next year, and these regional banks are hitting the sweet spot right now

Louis Navellier is the editor of Blue Chip Growth.


Article printed from InvestorPlace Media, https://investorplace.com/2013/12/3-bank-stocks-crushing-earnings/.

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