Riding on a steady growth momentum, shares of HopFed Bancorp Inc. (HFBC) reached a 52-week high of $11.75 on Mar 13. This provider of banking and financial services has witnessed a jump of about 5.6% in the past one year.
Moreover, the encouraging momentum of this Zacks Rank #3 (Hold) stock is fuelled by strategic initiatives and improved organic growth coupled with a strong liquidity and competitive position. Yesterday’s closing price represents a modest year-to-date return of about 2.5%, at par with the Nasdaq index. Average volume of shares traded over the last three months stands at approximately 5.7K.
On Jan 30, HopFedreported fourth-quarter 2014 operating earnings per share of 14 cents, comfortably surpassing the Zacks Consensus Estimate of 10 cents and the year-ago number of 9 cents. The company delivered a positive earnings surprise of 40% during the quarter.
Results reflected higher non-interest income and lower interest expense and loan loss provisions, coupled with lower-than-expected non-interest expenses and higher net interest margin. These were partially offset by lower interest income, while modest asset quality and capital ratios were other highlights.
Meanwhile, HopFed continues to seek quality loan growth opportunities aggressively. The company is also focusing on commencing at least one loan production office in the Tennessee market, thereby expanding its area of operations. Alongside, disciplined expense management bodes well for improving margins and operating leverage.
Concurrently, HopFed has showcased prudent capital management, which in turn, leaves ample scope for pursuing capital deployment strategies. We believe the upcoming quarters should benefit from the company’s operating and capital actions, as reflected in the market’s positive reaction.
Some better-ranked banking stocks that warrant a look are Pacific Premier Bancorp Inc. (PPBI), Meridian Interstate Bancorp Inc. (EBSB) and West BanCorp. Inc. (WTBA). All these stocks sport a Zacks Rank #1 (Strong Buy).