We issued an updated research report on
) on Jul 2, 2014. Despite reporting better-than-expected
first-quarter 2014 results, rising expenses and pressure on net
interest margin (NIM) pose major challenges for the company.
BankUnited has recorded a rise in operating expenses every year
since 2010 but for 2012 when expenses fell. Going forward, steeper
compensation expenses as well as costs associated with the
company's inorganic growth strategies will continue to increase the
Also, BankUnited witnesses persistent pressure on NIM. As the
interest rate environment is not expected to improve significantly
in the near future, we foresee substantial margin pressure in the
Nevertheless, given BankUnited's healthy liquidity position, we
find it favorably positioned to grow both organically and
inorganically. Synergies from the company's extended foothold in
the New York metropolitan market and Florida would support top-line
growth in the quarters ahead.
Moreover, BankUnited is an attractive pick for yield-seeking
investors. The company disburses capital to shareholders in form of
regular dividend payouts.
The Zacks Consensus Estimate for 2014 declined nearly 1.0% to $1.85
per share over the last 60 days. However, for 2015, the Zacks
Consensus Estimate advanced 1.0% to $2.13 per share over the same
BankUnited currently carries a Zacks Rank #3 (Hold).
Stocks That Warrant a Look
Some better-ranked banks include
Huntington Bancshares Incorporated
). All these stocks carry a Zacks Rank #2 (Buy).
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BANKUNITED INC (BKU): Free Stock Analysis
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HUNTINGTON BANC (HBAN): Free Stock Analysis
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