4 Reasons to Add Coastal Financial (CCB) Stock to Your Kitty
Coastal Financial Corporation CCB is a solid bet now, given its underlying strength and healthy long-term prospects. Higher interest rates, decent loan demand and a strong balance sheet position augur well for this Everett, WA- based company.
Analysts are bullish on the stock. Over the past 30 days, the Zacks Consensus Estimate for CCB’s earnings has moved 1% and 1.8% upward for 2023 and 2024, respectively. Currently, the company carries a Zacks Rank #2 (Buy).
CCB shares have gained 16.9% over the past month compared with the industry’s rise of 25.3%.
Image Source: Zacks Investment Research
We have mentioned a few factors below that make the CCB stock a rewarding investment pick now:
Solid Loan & Deposit Balance: Coastal Financial is focused on improving its loan and deposit balance. Over the last three years (2019-2022), loans and deposits saw a CAGR of 40.9% and 42.8%, respectively. Notably, both witnessed a sequential rise in the first quarter of 2023.
Hence, decent loan demand and modest deposit inflows are likely to keep the momentum going in the upcoming period.
Revenue Growth: Coastal Financial’s net revenues witnessed a CAGR of 24.2% over the last three years (2019-2022) and the trend continued in the first quarter of 2023. The improvement was backed by a strong loan and deposit balance, and high interest rates.
The trend is likely to continue for the next couple of years, with revenues expected to surge 84.9% in 2023 and 41.7% in 2024, attributable to higher rates, steady loan demand and solid deposits.
Earnings Growth: Coastal Financial witnessed earnings growth of 39.2% in the past three to five years, which is higher than the industry average of 10.2%. Also, the momentum is expected to continue in the near term, with earnings expected to grow 35.9% this year and 36.8% in 2024. It has a Growth Score of B. The Style Score when combined with Zacks Rank of 1 or 2 indicate further upside potential.
Favorable Return on Equity (ROE): Coastal Financial’s trailing 12-month ROE indicates its growth potential. The company’s ROE of 19.73% compares favorably with 14.12% for the industry. Thus, this reflects that CCB is more efficient in using shareholders’ funds.
Other Bank Stocks Worth a Look
A couple of other top-ranked stocks from the banking space are BNP Paribas BNPQY and First Citizens BancShares FCNCA.
The Zacks Consensus Estimate for BNP Paribas’ current-year earnings has been revised 13.3% upward over the past 30 days. Its shares have gained 6% in the past six months. Currently, BNPQY sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
First Citizens BancShares also sports a Zacks Rank #1 at present. Its earnings estimates for 2023 have been revised 67.2% upward over the past 30 days. In the past six months, FCNCA’s shares have rallied 69.3%.
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First Citizens BancShares, Inc. (FCNCA) : Free Stock Analysis Report
BNP Paribas SA (BNPQY) : Free Stock Analysis Report
Coastal Financial Corporation (CCB) : Free Stock Analysis Report
