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4 Reasons Why You Should Buy Bar Harbor Bankshares (BHB) Stock

Bar Harbor Bankshares BHB stock looks solid due to underlying fundamental strength and healthy long-term prospects. Also, decent revenue growth, projected earnings growth, and capital deployment activities bode well for the future.

Further, analysts are bullish on the stock. Over the past 60 days, the Zacks Consensus Estimate for 2023 earnings has moved 1.4% upward. Currently, it carries a Zacks Rank #2 (Buy). Over the past six months, shares of BHB have lost 20.2% compared with the industry’s decline of 30.4%.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Here are the factors that make Bar Harbor Bankshares an attractive investment pick right now:

Balance Sheet Growth: The company has displayed balance sheet growth over the last three years. Total loans have witnessed a compound annual growth rate (CAGR) of 6.4% over the last three years (2022-2022). The rising trend continued in the first quarter of 2023, which was primarily led by a rise in commercial loans. Moreover, total deposits have witnessed a CAGR of by 2.3% over the last three years (2022-2022).

Revenue Growth: Bar Harbor Bankshares’ net revenues witnessed a CAGR of 7.1% over the last three years (2020-2022) 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 grow 5% in 2023 and 3.1% in 2024.

Earnings Strength: BHB has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters, with the average surprise being 3.52%. Additionally, earnings are projected to grow at a rate of 3.46% this year. Also, the momentum is expected to continue in the near term, with earnings expected to grow 1% in 2024.

Encouraging Capital Deployment Activities: Bar Harbor Bankshares pays quarterly dividends on a regular basis. on Apr 20, BHB announced its quarterly dividend of 28 cents per share. This represents a rise of 7.7% from its prior payout. It increased dividends four times in the last five years. This resulted in an annualized dividend yield of 4.6%, considering the company’s last day’s closing price of $24.34. Apart from being attractive to investors, the yield also represented a steady income stream.

BHB announced a new stock repurchase plan on May 23, 2023, authorizing it to repurchase up to 756,000 shares. It replaced the previous authorization (announced in June 2022) to buy back 75,100 shares. Such strategic moves enhance shareholders’ value and boost investors’ confidence in the stock.

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 18.6% upward over the past 60 days. Its shares have gained 5.4% in the past six months. Currently, BNPQY sports a Zacks Rank #1 (Strong Buy).

First Citizens BancShares 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 55.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

First Citizens BancShares, Inc. (FCNCA) : Free Stock Analysis Report

BNP Paribas SA (BNPQY) : Free Stock Analysis Report

Bar Harbor Bankshares, Inc. (BHB) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

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