From the vast universe of banking stocks, today we pick BancorpSouth, Inc. BXS for you. The company offers a profitable investment opportunity based on steady earnings growth and robust fundamentals.
It has been witnessing upward estimate revisions, reflecting analysts’ optimism about its earnings growth potential. Over the last 90 days, the Zacks Consensus Estimate for 2019 and 2020 displayed an upward trend.
Further, this Zacks Rank #2 (Buy) stock has gained around 10.8%, over the past three months, compared with 13.3% growth recorded by the industry.
BancorpSouth has a number of other aspects that make it an attractive investment option.
5 Reasons Why BancorpSouth is a Golden Egg
Earnings Strength: BancorpSouth witnessed record (3-5 years) earnings per share growth of 13.23% compared with 11.54% growth recorded by the industry. In addition, the company recorded average positive earnings surprise of 3.85%, in the last four quarters.
Revenue Growth: BancorpSouth continues to make steady progress toward improving its top line, with sales recording 5-year compounded annual growth rate (CAGR) of around 6.8% during 2014-2018. Further, the company’s projected sales growth (F1/F0) of 8.54% (as against the industry average of about 2.09%) indicates constant upward momentum in revenues.
Strategic Deals: BancorpSouth has been making strategic investments through mergers and acquisitions (M&A). For the past few years, the company has maintained an acquisition spree, fortifying its footprint in various areas. These transactions will likely continue being accretive to earnings. Moreover, the company looks forward to tap similar opportunities in future as well.
Leverage: BancorpSouth’s debt/equity ratio stands at 0.00 against the industry average of 0.24, reflecting no debt burden compared with the industry. It highlights the company’s sound financial flexibility.
Steady Capital Deployment: BancorpSouth’s ability to generate positive cash flows and enhance shareholders’ value through regular dividend payments, and share repurchases is commendable. Notably, last July, the company raised its quarterly cash dividend by 21.4%. Later in December, BancorpSouth announced a share-repurchase program of approximately 3 million shares of its outstanding common stock through December 2019.
Other Key Picks
Comerica Incorporated CMA has been witnessing upward estimate revisions for the past 60 days. Further, the stock has appreciated more than 18% in the past three months. It currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
M&T Bank Corporation MTB has been witnessing upward estimate revisions for the past 60 days, with the company’s shares rising nearly 17.6%, in three months’ time. It holds a Zacks Rank of 2, at present.
Bank of America Corporation BAC has been witnessing upward estimate revisions for the past 60 days. Over the past three months, this Zacks #2 Ranked company’s shares have been up more than 19%.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Bank of America Corporation (BAC) : Free Stock Analysis Report
M&T Bank Corporation (MTB) : Free Stock Analysis Report
Comerica Incorporated (CMA) : Free Stock Analysis Report
BancorpSouth Bank (BXS) : Free Stock Analysis Report
To read this article on Zacks.com click here.