Growth Opportunities for Small Banks in the Northeast and Mid-Atlantic: Matthew C. Schultheis, Analyst at Boenning & Scattergood, Inc., Interviews with The Wall Street Transcript
67 WALL STREET, New York - July 1, 2013 - The Wall Street Transcript has just published its U.S. Banking Review 2013 Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: U.S. Banking Review 2013
Companies include: Webster Financial Corp. (WBS), First Niagara Financial Group (FNFG), Cardinal Financial Corp. (CFNL), Signature Bank (SBNY), Valley National Bancorp (VLY), Provident Financial Services, (PFS) and many more.
In the following excerpt from the U.S. Banking Review 2013 Report, an expert analyst discusses the outlook for the sector for investors:
TWST: What are some of your other favorites?
Mr. Schultheis: I have First Niagara (FNFG) as a top pick. I have a $10 target on it, and it closed yesterday at $7.78. This is a company that has had its challenges. They made a large acquisition that took them more time to digest than they were anticipating. They had to issue stock to do it, and it was not necessarily handled ideally. But I think now that the company has reached the point where the best news over the next three quarters or so is no news, and they can focus on loan growth.
They have adequate deposits, and they have basically been redeploying securities into loans, which should help with margin a little bit. It's a good story from the tangible book build perspective. Tangible book is about $5.50, and I'm looking for the company to do $0.70 to $0.75 a share for this year and next year, so I think they can build their tangible book faster than most. As long as they don't go out and try to do another acquisition, even mundane earnings over a couple of quarters will drive this upside.
I would also draw attention to Northern Virginia-based Cardinal Financial (CFNL). They are growing their core bank at roughly 15% a year because of the loan growth they are generating. A lot of this is relatively low risk, because they have done a good job of staying in close to the Beltway. As we all know, the bureaucracy basically stays in place no matter how D.C.'s political decisions may affect the retiree in Kansas or the person who is working for a defense contractor in California. Cardinal has been able to...
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