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Southwest Bancorp Upped to Strong Buy

Zacks Equity Research

On Aug 3, Zacks Investment Research upgraded Southwest Bancorp Inc. (OKSB) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Southwest Bancorp has been witnessing rising earnings estimates on the back of strong second-quarter 2013 results. Moreover, the long-term expected earnings growth for this well-known banking and financial services provider is 7.5%.

Southwest Bancorp reported its second-quarter results on Jul 23 with earnings per share of 22 cents, substantially beating the Zacks Consensus Estimate of 17 cents by 29.4% and the year-ago earnings of 15 cents by 47%. Robust results for the reported quarter were primarily aided by reduced non-interest expenses, decreased income tax expenses and negative provision for loan losses.

Non-interest expense declined 23% from the year-ago period to $12.8 million. This reduction reflected prudent expense management by the company.

Credit quality continues to exhibit an improvement for Southwest Bancorp. Provision for loan losses was negative $0.9 million as compared with $0.03 million in the prior-year quarter. Nonperforming assets were $4.7 million, down 52% year over year.

However, on the downside, net interest income declined 23% year over year to $15.1 million. Net interest margin was 3.07%, down 64 basis points as compared with the year-ago quarter. Non-interest income decreased 3% to $3.5 million.

Following second-quarter 2013 results, the Zacks Consensus Estimate for 2013 increased 14.8% to 70 cents per share on the back of four upward revisions, over the last 30 days. For 2014, the Zacks Consensus Estimate advanced 3.9% to 80 cents per share with three estimates moving north over the same time period.

Other Stocks to Consider

Besides Southwest Bancorp, other stocks in the same industry with a Zacks Rank #1 include Prosperity Bancshares Inc. (PB), while First Financial Bankshares Inc. (FFIN) and MidWest One Financial Group, Inc. (MOFG) carrying a Zacks Rank #2 (Buy) are also worth considering.

Read the Full Research Report on OKSB

Read the Full Research Report on PB

Read the Full Research Report on FFIN

Read the Full Research Report on MOFG

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