Shares of First Interstate Bancsystem Inc. (FIBK) crafted a new 52-week high, touching $26.60 at the end of the trading session on Nov 21. However, this commercial and consumer banking services provider closed the session at $26.58, which reflects a solid year-to-date return of 71.8%. The trading volume for the session was 88,147 shares.
Despite hitting its 52-week high, this Zacks Rank #1 (Strong Buy) stock has plenty of upside left, given its strong estimate revisions over the last 30 days and expected long-term earnings growth of 7.5%.
Growth Drivers
Impressive third-quarter 2013 results – including a positive earnings surprise of 25.58%, improved credit quality and reduced non-interest expenses – as well as a strong capital position were the primary growth drivers for First Interstate Bancsystem.
On Oct 21, First Interstate Bancsystem reported its third-quarter 2013 earnings of 54 cents per share, outpacing the Zacks Consensus Estimate of 43 cents by 25.58%. Moreover, results surpassed the prior-year quarter earnings of 35 cents by 54.29%.
A year-over-year decrease of 7.9% in non-interest expenses, negative provision for loan losses and a rise in deposits and loans were the tailwinds for the quarter. Moreover, the company’s capital ratios depict its strong position. However, a 5.1% fall in the top line acted as the headwind for the quarter.
Further, First Interstate Bancsystem has now delivered positive earnings surprises in the last 5 quarters with an average beat of 21.67%.
Estimate Revisions Show Potency
Over the last 30 days, all 5 estimates for 2013 have been revised upward for First Interstate Bancsystem, lifting the Zacks Consensus Estimate by 8.4% to $1.94 per share. For 2014, all 5 estimates moved north, helping the Zacks Consensus Estimate advance 5.3% to $1.78 per share.
Investors interested in the banking industry may consider stocks like German American Bancorp Inc. (GABC), PrivateBancorp, Inc. (PVTB) and Mainsource Financial Group (MSFG). All these stocks carry a Zacks Rank #1.
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