The Zacks Analyst Blog Highlights Pathward Financial, Coastal Financial and CB Financial
For Immediate Release
Chicago, IL – June 26, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Pathward Financial, Inc. CASH, Coastal Financial CCB and CB Financial Services CBFV.
Here are highlights from Friday’s Analyst Blog:
3 Top Bank Stocks to Gain as Powell Stays Hawkish
Federal Reserve Chair Jerome Powell confirmed this week that policymakers expect more interest rate hikes this year to bring down inflation, and the central bank is likely to continue its aggressive monetary tightening policy. Powell said that even if inflation has moderated, it remains way above the Fed’s 2% target.
The personal consumption expenditure (PCE) price index, the Fed’s preferred inflation gauge, increased 4.7% year over year in April, per the Commerce Department. In reality, the core PCE index, which generally excludes volatile energy and food prices, jumped 4.7% in April from the same period last year.
The consumer price index (CPI), in the meantime, advanced 4% annually in May, per the Bureau of Labor Statistics. Most importantly, the core CPI increased by 5.3% year over year in May, signifying that even though price pressures have lessened to a certain degree, underlying inflation remains hot.
Powell’s hawkish remarks, by the way, come after Fed officials, in their recently concluded June policy meeting, decided not to increase interest rates for the first time in more than a year.
However, central bank officials projected two more quarter-of-a-percentage-point rate hikes later this year, taking the target range to as high as 5.6%. Also, the CME FedWatch tool, as of now, shows that 76.9% of market participants are expecting a 25-basis point rate hike in July.
Now, increasing interest rates does not necessarily bode well for the stock market as it increases the cost of borrowing, curtails consumer spending, and deters economic growth. But the financial sector, in particular, tends to gain from rising interest rates, and banks are the go-to rate trade.
This is because a bank’s profit margins improve when interest rates are hiked. After all, rate hikes lead to an increase in the spread between what the lenders earn by funding long-term assets, such as loans, with short-term liabilities, like customer deposits. At the same time, the banking sector turmoil has subsided somewhat.
Given the aforesaid positives, we have selected three sturdy bank stocks that carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth, and M for Momentum and the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Pathward Financial, Inc. operates as the holding company for Pathward, National Association which provides banking products and services principally in the United States. Currently, Pathward Financial has a VGM Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 1.8% over the past 60 days. CASH’s expected earnings growth rate for the current year is nearly 27%.
Coastal Financial is a bank holding company. It provides account checking, savings deposits, money market, mortgage, and term loan services. Presently, Coastal Financial has a VGM Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 1.7% over the past 60 days. CCB’s expected earnings growth rate for the current year is 35.9%.
CB Financial Services is the bank holding company for Community Bank, a chartered commercial bank. The bank’s services include personal banking and business banking. Currently, CB Financial Services has a VGM Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 1.7% over the past 60 days. CBFV’s expected earnings growth rate for the current year is 37.2%.
Pathward Financial, Coastal Financial, and CB Financial Services’ estimated earnings growth rates for the next year are 13.2%, 36.7% and 3.4%, respectively.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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
Pathward Financial, Inc. (CASH) : Free Stock Analysis Report
CB Financial Services, Inc. (CBFV) : Free Stock Analysis Report
Coastal Financial Corporation (CCB) : Free Stock Analysis Report
