On Aug 23, 2013, we reaffirmed our Neutral recommendation on
). This was based on the company's encouraging second-quarter
2013 results. However, the sluggish economic scenario and
persistently rising expenses continue to be causes of concern.
On Jul 18, BB&T reported second-quarter 2013 earnings of 77
cents per share, beating the Zacks Consensus Estimate of 74
cents. Earnings were primarily driven by a surge in non-interest
income, partially offset by reduced net interest income and
higher operating expenses. Growth in loans and deposits, a strong
capital position and improved credit quality added to the
company's strong financials.
The Zacks Consensus Estimate for 2013 advanced 1.0% to $2.97 per
share over the last 60 days. However, for 2014, the Zacks
Consensus Estimate remained unchanged at $3.09 per share over the
same time period. As a result, BB&T currently carries a Zacks
Rank #3 (Hold).
BB&T continues to look attractive to yield-seeking investors
because of its dividend paying nature. Earlier this year, the
company hiked it quarterly cash dividend by 15%.
Moreover, growth in client deposits and non-interest-bearing
deposit accounts has been impressive in the preceding quarters.
The company intends to expand by opening 30 new branches in Texas
through the remainder of 2013. Additionally, continued stability
in net interest margin is a major strength of BB&T.
BB&T CORP (BBT): Free Stock Analysis
BANKUNITED INC (BKU): Free Stock Analysis
PNC FINL SVC CP (PNC): Free Stock Analysis
STATE ST CORP (STT): Free Stock Analysis
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Though credit metrics improved in the said quarter, they continue
to be an area of concern for BB&T. Further, a tepid economic
recovery, continuous rise in operating expenses, exposure to
problem assets and various regulatory issues are other factors
plaguing the bank.
Other Stocks Worth Considering
Other better performing banks include
State Street Corporation
The PNC Financial Services Group, Inc.
). While BankUnited has a Zacks Rank #1 (Strong Buy), both State
Street Corporation and PNC Financial carry a Zacks Rank #2