Shares of Commerce Bancshares, Inc. (CBSH) hit a new 52-week high of $48.06 during the first half of the trading session on Nov 25. However, the stock closed the session at $47.82, which reflects a year-to-date return of 33.8%. The trading volume for the session was 298,906 shares.
Despite the strong price appreciation, this Zacks Rank #3 (Hold) Midwest bank still has considerable upside left, given its positive estimate revision over the last 60 days and expected year-over-year earnings growth of 7.7% for 2013.
Commerce Bancshares’ impressive price performance was driven by steady capital deployment activities and strong third-quarter 2013 results that included a positive earnings surprise of 4.2%. Additionally, the company maintains a robust capital position in compliance with regulatory requirements.
On Oct 15, Commerce Bancshares declared third-quarter earnings of 75 cents per share, which beat the Zacks Consensus Estimate of 72 cents. Better-than-expected results came on the back of higher non-interest income and decreased operating expenses, partially offset by decline in net interest income.
Commerce Bancshares’ total loans increased 12.3% to $10.8 billion compared with the prior-year period. Total deposits rose 8.1% year over year to $18.2 billion. Further, credit quality as well as profitability ratios improved, thereby reflecting the company’s financial strength.
Further, Commerce Bancshares continues to meaningfully enhance shareholders’ value. Earlier this month, along with its regular dividend payouts, the company declared an additional 5% stock dividend for its shareholders.
Estimate Revisions Show Potency
In the last 60 days, the Zacks Consensus Estimate for 2013 increased 0.7% to $2.88 per share. For 2014, the Zacks Consensus Estimate advanced 1.4% to $2.97 per share over the same time frame.
Better-ranked banks in the same region include First Interstate Bancsystem Inc. (FIBK), German American Bancorp Inc. (GABC) and Mainsource Financial Group (MSFG). All these stocks carry a Zacks Rank #1 (Strong Buy).