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Territorial Bancorp Upped to Strong Buy

Zacks Equity Research

On Nov 5, Zacks Investment Research upgraded Territorial Bancorp Inc. (TBNK) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Territorial Bancorp has been witnessing rising earnings estimates on the back of strong third-quarter 2013 results and the recent hike in its common stock dividend. The long-term expected earnings growth rate for this stock is 4%. Further, Territorial Bancorp has now delivered positive earnings surprises in the last 4 quarters with an average beat of 13%.

Territorial Bancorp reported its third-quarter results on Oct 31 with earnings per share of 39 cents, beating the Zacks Consensus Estimate of 33 cents by 18.2% and the year-ago earnings of 36 cents by 8.3%.

Robust results for the reported quarter were primarily driven by organic growth, which reflected an elevated top line along with increased loans and deposits. Yet, these positives were partially offset by augmented non-interest expenses.

Concurrent with the earnings release, Territorial Bancorp announced a 7.7% rise in its quarterly common stock cash dividend to 14 cents per share. The increased dividend will be paid on Nov 27 to shareholders as of Nov 14, 2013.

Following third-quarter 2013 results and the dividend increase, the Zacks Consensus Estimate for 2013 increased 5.1% to $1.45 per share, over the last 7 days. For 2014, the Zacks Consensus Estimate advanced 2.4% to $1.30 per share over the same time period.

Other Stocks to Consider

Besides Territorial Bancorp, other Northeast banks that are worth considering include Financial Institutions Inc. (FISI), Center Bancorp, Inc. (CNBC) and Signature Bank (SBNY).  All 3 banks carry a Zacks Rank #1.

Read the Full Research Report on TBNK
Read the Full Research Report on FISI
Read the Full Research Report on SBNY

Zacks Investment Research