Performance of banks in first-quarter 2019 was quite impressive. Loan growth, rising fee income, controlled expenses and rise in interest rates supporting margins boosted investors’ confidence in banking stocks. Therefore, some of these stocks can be profitable additions to your portfolio, supported by robust fundamentals and encouraging long-term prospects.
Thus, this is the right time to add a few banking stocks to your portfolio. Today, we bring one such stock — 1st Source Corporation SRCE — that continues to depict solid fundamentals and improving prospects. This bank appears to be a solid bet right now due to its sound organic growth strategies.
Further, this Zacks Rank #2 (Buy) stock has appreciated more than 12.7% year to date compared with 6% growth registered by the industry.
In addition, the Zacks Consensus Estimate for its current-year earnings has been revised slightly upward, over the past 60 days.
Notably, 1st Source Corporation has a number of other aspects that make it an attractive investment option.
Why 1st Source Corporation (SRCE) is a Must Buy
Strong Organic Growth: 1st Source Corporation’s revenues witnessed 8.4% compounded annual growth rate (CAGR) over the last five years, ending 2018. The company’s projected sales growth (F1/F0) of 4% highlights continued upward momentum in revenues.
Earnings per Share Strength: 1st Source Corporation witnessed earnings growth of 9% in the last three-five years. This earnings momentum is likely to continue in the near term as reflected by the company’s projected earnings per share (EPS) growth rate (F1/F0) of 12.34%. Also, the company’s long-term (three-five years) estimated EPS growth rate of 10% promises rewards for investors over the long run.
Strong Leverage: 1st Source Corporation’s debt/equity ratio is valued at 0.17 compared with the industry average of 0.40, indicating a relatively lower debt burden. It highlights the financial stability of the company despite an unstable economic environment.
Superior Return on Equity (ROE): 1st Source Corporation’s ROE of 11.27%, compared with the industry average of 10.7%, highlights the company’s commendable position over its peers.
Stock Looks Undervalued: The stock currently has a Value Score of B. The Value Score condenses all valuation metrics into one actionable score that helps investors steer clear of “value traps” and identify stocks that are truly trading at a discount. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Other Stocks to Consider
First Business Financial Services, Inc. FBIZ has been witnessing upward estimate revisions, for the past 60 days. Moreover, this Zacks #1 Ranked stock has rallied more than 19%, year to date. You can see the complete list of today’s Zacks #1 Rank stocks here.
Franklin Resources, Inc. BEN has been witnessing upward estimate revisions, for the past 60 days. Also, the company’s shares have gained nearly 12.2% year to date. At present, it sports a Zacks Rank of 1.
E*TRADE Financial Corporation ETFC has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped around 6.8% year to date. It currently carries a Zacks Rank #2.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
Click here to see these breakthrough stocks now >>
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 Business Financial Services, Inc. (FBIZ) : Free Stock Analysis Report
1st Source Corporation (SRCE) : Free Stock Analysis Report
E*TRADE Financial Corporation (ETFC) : Free Stock Analysis Report
Franklin Resources, Inc. (BEN) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research