Shares of PrivateBancorp, Inc. (PVTB) hit a new 52-week high, touching $26.52 almost at the end of trading session on Nov 14. However, the stock closed the session at $26.48, which reflects a solid year-to-date return of 64.4%. The trading volume for the session was 270,092 shares.
Despite the strong price appreciation, this Zacks Rank #1 (Strong Buy) Midwest bank has plenty of upside left, given its positive estimate revisions over the last 30 days and expected year-over-year earnings growth of 7.8% for 2013.
Growth Drivers
PrivateBancorp’s impressive price performance reflects strong third-quarter 2013 results, which included a positive earnings surprise of 13.5%. Moreover, the company maintains a robust capital position in compliance with regulatory requirements.
On Oct 17, PrivateBancorp declared third-quarter operating earnings of 42 cents per share beating the Zacks Consensus Estimate of 37 cents. Lower operating expense and consistent organic growth through increase in loans and deposits were the highlights of the quarter.
PrivateBancorp’s non-interest expense totaled $71.3 million, down 12.8% from the prior-year quarter. Further, total deposits were $11.8 billion, up 4.6% from third-quarter 2012. Total loans were $109.4 billion, up 8% from the prior-year period.
PrivateBancorp continues to strategically increase its market share. Moreover, an improved credit quality and prudent expense management are the company’s strengths. However, decline in mortgage activities and competitive pressure on loan pricing may affect profitability in the long run.
Estimate Revisions Show Potency
In the last 30 days, the Zacks Consensus Estimate for 2013 increased 5.4% to $1.55 per share. For 2014, the Zacks Consensus Estimate advanced 7.2% to $1.64 per share over the same time frame.
Other financial organizations worth considering include First Interstate Bancsystem Inc. (FIBK), German American Bancorp Inc. (GABC) and Mainsource Financial Group (MSFG). All these stocks carry the same Zacks Rank as PrivateBancorp.
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