On Jul 4, Zacks Investment Research upgraded First Financial Bankshares Inc. (FFIN) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
First Financial has been witnessing rising earnings estimates due to the completion of an acquisition, hike in dividend and better-than-expected first-quarter results. Moreover, this regional bank has a long-term earnings growth forecast of 7.0%.
On May 31, First Financial announced the closure of a deal to acquire Orange, Texas-based Orange Savings Bank, SSB. The cash-and-stock transaction, announced in February, is valued at approximately $56.0 million.
Additionally, in Apr 2013, First Financial declared 26 cents per share cash dividend for the second quarter. This was 4.0% higher than the prior-year quarter amount. The dividend was paid on Jul 1 to shareholders of record on Jun 14.
Moreover, First Financial announced first-quarter earnings of 59 cents per share, surpassing the Zacks Consensus estimate by nearly 4%. Results were driven by almost stable net interest and non-interest revenues, partially offset by a rise in operating expenses.
Notably, over the past 4 quarters, First Financial delivered positive earnings surprises in 3 quarters, with an average beat of 3.1%. Moreover, during the last 60 days, the Zacks Consensus Estimate for 2013 increased 1.6% to $2.50 per share. For 2014, the Zacks Consensus Estimate rose 3.1% to $2.65 per share over the same time period.
Positive earnings surprises and favorable estimate revisions made way for the rank upgrade.
Other Stocks to Consider
Other stocks in the banking sector that are worth a look include Center Bancorp Inc. (CNBC), Farmers Capital Bank Corporation (FFKT) and Central Pacific Financial Corp. (CPF). All of them carry a Zacks Rank #1.
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