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First Interstate Bancsystem Upped to Strong Buy

Zacks Equity Research

On Jun 20, Zacks Investment Research upgraded First Interstate Bancsystem Inc. (FIBK) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

First Interstate Bancsystem has been witnessing rising earnings estimates on the back of strong first-quarter 2013 results. Moreover, this well-known commercial and consumer banking services provider delivered positive earnings surprises in the last 3 quarters with an average beat of 17.9%. The long-term expected earnings growth rate for this stock is 7.5%.

First Interstate Bancsystem reported its first-quarter results on Apr 22 with earnings per share of 46 cents, substantially beating the Zacks Consensus Estimate of 35 cents by 31.4% and the year-ago earnings of 26 cents by 76.9%. Robust results for the reported quarter were primarily aided by higher non-interest income, reduced non-interest expenses and lower provision for loan losses.

Non-interest income jumped 9% year over year to $28.8 million. Non-interest expense dipped 1.2% from the year-ago period to $56.7 million. Provision for loan losses stood at $0.5 million compared with $11.3 million in the prior-year quarter. However, on the downside, net interest income decreased 2.3% to $60.4 million.

Credit quality continues to exhibit an improvement. Nonperforming loans were $100.5 million, waning 45.9% year over year. Nonperforming assets were $133.0 million, down 42.3% year over year.

Following first-quarter 2013 results for First Interstate Bancsystem, the Zacks Consensus Estimate for 2013 increased 8.9% to $1.59 per share over the last 60 days. For 2014, the Zacks Consensus Estimate advanced 2.6% to $1.60 per share.

Other Stocks to Consider

Besides First Interstate Bancsystem, other stocks in the same sector with a Zacks Rank #1 include Enterprise Financial Services Corp. (EFSC), Old Second Bancorp Inc. (OSBC) and First Business Financial Services, Inc. (FBIZ).

Read the Full Research Report on FBIZ

Read the Full Research Report on OSBC

Read the Full Research Report on FIBK

Read the Full Research Report on EFSC

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