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Huntington (HBAN) Up 10.8% YTD: What's Driving the Stock?

Zacks Equity Research

Of late, the finance sector has been putting up an impressive performance, with some monthly volatility. The United States’ economic health, on which this sector is largely dependent, has been displaying steady improvement with increasing real GDP numbers, declining unemployment rate, improving consumer spending and stabilizing housing market.

Additionally, the economic growth is likely to be robust in the near term, while at the same time trade tensions might jeopardize the uptrend.

Riding on higher rates and improved lending margins, along with lesser regulations under the Trump administration, the finance sector has emerged triumphant. Therefore, the financial stocks have performed decently to register positive gains, year to date.

One such stock is Huntington Bancshares Incorporated HBAN, which has rallied 10.8% year to date, against the industry’s growth of 7%.

Furthermore, with the improving macroeconomic environment and the company’s accomplishment of its core strategies, total revenues for full-year 2019 are projected to be up 4-7% for Huntington. Moreover, the company’s strategic initiatives, including expansion moves, are anticipated to bolster revenue growth.

Additionally, estimates for this Zacks Rank #3 (Hold) stock remained unrevised. In the last seven days, the Zacks Consensus Estimate for 2019 and 2020 remained unchanged.

Huntington’s ROE of 14.20%, compared with the industry average of 10.75%, indicates the company’s commendable position over its peers.

Huntington’s earnings have increased 10.85% annually over the last three to five years. The earnings growth momentum is anticipated to continue in the near term as well. The company’s projected EPS (earnings per share) growth (F1/F0) is 10% for 2019 and (F2/F1) nearly 6.52% for 2020.

Additionally, Huntington is focused on acquiring the industry's best deposit franchise. The company’s total average deposits witnessed a three-year CAGR of 5.9% in 2018. In addition, driven by strong performance in the commercial and consumer portfolio, total average loan balance recorded a three-year CAGR of 5.8% in 2018. The increasing trend in average deposits and loan balances continued in first-quarter 2019 as well.

Stocks to Consider

First Business Financial Services, Inc. FBIZ has been witnessing upward estimate revisions, for the past 60 days. Moreover, this Zacks #1 (Strong Buy) 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.

1st Source Corporation SRCE has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped around 12.7% year to date. It currently carries a Zacks Rank #2.

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First Business Financial Services, Inc. (FBIZ) : Free Stock Analysis Report
Huntington Bancshares Incorporated (HBAN) : Free Stock Analysis Report
1st Source Corporation (SRCE) : Free Stock Analysis Report
Franklin Resources, Inc. (BEN) : Free Stock Analysis Report
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