Shares of BancFirst Corp. (BANF) hit a new 52-week high of $64.70 on Aug 25, riding on a strong growth momentum. Notably, this commercial banking service provider’s shares have risen 6.4% since the company reported second-quarter results in mid-July.
BancFirst also maintained its earnings streak in all the past four quarters, with an average beat of 8.3%. The momentum of this Zacks Rank #2 (Buy) stock has been driven by the company’s strong earnings performance and asset quality as well as adequate liquidity and competitiveness over other larger players.
Yesterday’s closing price represented a robust year-to-date return of about 13.2% against a return of 9.7% clocked by the Nasdaq index. Average volume of shares traded over the last three months stands at approximately 21.26K.
Earnings Review
On Jul 17, BancFirst reported second-quarter 2014 earnings per share (EPS) of 92 cents, higher than the Zacks Consensus Estimate of 87 cents. EPS also beat the year-ago quarter figure of 82 cents despite higher share count.
Results reflected 8.8% year-over-year growth in non-interest income and 13.1% rise in interest income. These factors were partially offset by higher non-interest expenses and loan loss provisions.
Nevertheless, profitability metrics remained on the progress track as reflected by improved return on average assets and net interest margin. Notably, return on equity (ROE) also grew to 10.2% from 9.5% in the year-ago quarter.
Rationale
BancFirst is gaining strength in Oklahoma from the acquisition of assets of The Bank of Union, El Reno, Oklahoma (The Bank of Union) from the FDIC, at the beginning of this year. Alongside, a strong loan portfolio as well as improved charge-offs and delinquency rates reflect a healthy credit profile. BancFirst’s growth prospects and efforts to expand have boosted investors’ sentiment as well.
Meanwhile, one could also consider financial stocks like Cullen/Frost Bankers Inc. (CFR), Opus Bank (OPB) and Cowen Group Inc. (COWN), all of which have the same Zacks Rank as BancFirst.
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