Market Overview

Wells Fargo, BB&T and Other Bank Stocks on a Roll

Wells Fargo (NYSE: WFC) and JP Morgan Chase (NYSE: JPM) help kick off the new earnings season this week when they post their first-quarter results on Friday. Citigroup (NYSE: C), Goldman Sachs (NYSE: GS) and others follow early next week. Some analysts are looking to the financial sector for the season's best earnings reports, and so should be pleased with Well Fargo's anticipated earnings growth, but not so much with the earnings decline forecast for JP Morgan.

Here is a look at some banks whose share prices have grown between 18% and 40% since the beginning of the year. They all are trading at or near their 52-week highs as well.

Ameris Bancorp (NASDAQ: ABCB) shares are trading more than 24% higher than at the beginning of the year, despite pulling back more than 2% in the past week. The bank recently acquired Central Bank of Georgia from the FDIC after the latter bank failed. The Georgia-based Ameris has a $303.8 million market cap and a long-range EPS growth forecast of 9.0%. Over the past six months, the stock has outperformed competitors such as Capital City Bank Group (NASDAQ: CCBG).

Banco de Chile (NYSE: BCH) is more than 18% higher year to date but the share price has pulled back about 2% in the past week. This Santiago-based bank dramatically increased its top and bottom lines during the recession. It has a return on equity of 28.5% and a dividend yield of 3.9%. Its market cap is $13.5 billion. Short interest is 0.4% of the float. The stock has outperformed the likes of Banco Santander Chile (NYSE: SAN) and CorpBanca (NYSE: BCA) over the past six months.

BB&T (NYSE: BBT) shares are trading more than 23% higher year to date after pulling back more than 3% from a recent 52-week high. The Winston-Salem, N.C.-based S&P 500 component just completed acquisition of Crump Group's insurance business. BB&T has a market cap of $21.4 billion and a dividend yield of 2.6%. Over the past six months, the stock has outperformed competitors such as SunTrust Banks (NYSE: STI) but narrowly underperformed Bank of America (NYSE: BAC).

See also: These Financial Stocks Are on Fire

Citizens Republic Bancorp (NASDAQ: CRBC) is almost 39% higher than at the beginning of the year and up more than 16% just in the past month. The Flint, Mich.-based company is expected to have swung to a profit in its April 26 report. It has a market cap of $633.6 million and an EPS growth forecast of 14.4% for the next year. The stock has outperformed larger competitors such as JP Morgan Chase, U.S. Bancorp (NYSE: USB) and Wells Fargo over the past six months.

Credicorp's (NYSE: BAP) share price is more than 23% higher year to date and near a mulityear high. Credicorp is a Peruvian full service bank providing services to customers in Peru, Bolivia and Panama. The $10.7 billion market cap company has a long-range EPS growth forecast of 15.1%, a return on equity of 22.6% and a dividend yield of 1.7%. Over the past six months, the stock has outperformed Banco Santander (NYSE: STD) and Banco Bilbao Vizcaya Argentaria (NYSE: BBVA).

Washington Federal (NASDAQ: WAFD) saw its share price rise more than 19% year to date but it has plateaued in the past two weeks. The Seattle-based savings and loan announced last week it will acquire South Valley Bancorp. Washington Federal's market cap is $1.8 billion and its dividend yield is 1.9%. The price-to-book ratio is 0.9 and the PEG ratio is in line with the industry average. The stock has outperformed the likes of Northwest Bancshares (NASDAQ: NWBI) over the past six months.

Wells Fargo's (NYSE: WFC) share price is up almost 22% year to date and recently hit a multiyear high. EPS are expected to be about 7% higher year over year when the bank reports Q1 results this week, but revenues are predicted to be essentially flat. The $176.4 billion market cap company has a dividend yield of 2.6%. The operating margin is better than the industry average. The stock has outperformed competitors such as Bank of America, Citigroup and JP Morgan over the past year.

See also: Top Stock Picks of Best Performing Hedge Fund Managers

ACTION ITEMS:

Bullish: Investors interested in banks with healthy dividends may want to consider the following trades:

  • BBVA Banco Frances (NYSE: BFR) has a dividend yield of 19.0%.
  • CorpBanca (NYSE: BCA) has a dividend yield of 7.5%.
  • Westpac Banking (NYSE: WBK) has a dividend yield of 7.1%.
  • HSBC Holdings (NYSE: HBC) has a dividend yield of 6.4%.
Bearish:

Traders may prefer to consider these alternative positions:

  • ProShares UltraShort Financials (NYSE: SKF) is trading near a 52-week low.
  • Direxion Daily Financial Bear 3X Shares (NYSE: FAZ) is trading near a 52-week low.
Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

Posted-In: Ameris Bancorp Banco Bilbao Vizcaya Argentaria Banco de Chile Banco SantanderLong Ideas Short Ideas Dividends Trading Ideas Best of Benzinga

 

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