BankUnited, Inc. BKU is well positioned for growth given its solid balance sheet, improving loan balance and higher interest rates. Also, the company’s steady capital deployment actions and efforts to strengthen fee income sources are commendable.
Further, analysts are optimistic about the stock. The Zacks Consensus Estimate for earnings has moved 1.4% and 5.5% upward for 2019 and 2020, respectively, over the past 60 days.
Further, this Zacks Rank #2 (Buy) stock has rallied 11.8% so far this year, outperforming industry’s growth of 11%.
Why an Attractive Choice?
Revenue strength: BankUnited’s net revenues have witnessed a compounded annual growth rate of 11.7% over the last four years (ended 2018). The solid top-line increase was backed by strong loan and deposit growth as well as higher interest rates. These, along with efforts to improve fee income, will likely boost the company’s top line in the quarters ahead.
Earnings growth: Over the past three to five years, BankUnited witnessed earnings growth of 12.8%. The momentum is expected to continue as the company’s earnings are projected to rise 20% and 15.1% in 2019 and 2020, respectively.
In addition, the company’s long-term (three to five years) estimated earnings growth rate of 8.9% promises rewards for investors, over the long run.
Sustainable capital deployments: BankUnited has been consistent with its dividend payment for a long time now. Further, in January, the company authorized share repurchase of up to $150 million. Despite having a higher debt/equity ratio than the industry, the bank’s solid liquidity position and earnings strength will help it sustain the current level of capital deployment activities, thus enhancing shareholder value.
Stock seems undervalued: BankUnited has P/S and P/B ratios of 2.11 and 1.14 compared with the industry average of 2.58 and 1.22, respectively. Based on these ratios, the stock seems undervalued.
Other Stocks Worth a Look
BancFirst Corporation’s BANF earnings estimates have witnessed upward revision over the past 60 days. This Zacks Rank #1 (Strong Buy) stock has rallied 7.9% so far this year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings estimates of Sierra Bancorp BSRR for 2019 have witnessed an upward estimate revision over the past 60 days. Also, the stock has rallied 6.8% so far this year. It has a Zacks Rank #2.
TriCo Bancshares’ TCBK earnings estimates for the current year have been revised upward over the past 60 days. The shares of this Zacks Rank #2 company has rallied 14.4% so far this year.
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BankUnited, Inc. (BKU) : Free Stock Analysis Report
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