On Jun 25, 2013, we reiterated our long term Neutral
BOK Financial Corp.
) primarily based on its improved credit quality metrics and
prudent expense management. However, declining revenues were the
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Despite the macroeconomic pressure, BOK Financial's credit
quality continues to normalize. Credit metrics consistently
improved in 2012 as the overall financial condition of businesses
and consumers strengthened and the housing market improved in
many areas. Going forward, we expect asset quality to improve.
BOK Financial's first-quarter earnings of $1.28 per share beat
the Zacks Consensus Estimate as well as the prior-quarter figure
by 6%. Reduced net charge-offs and strong capital ratios were the
positives for the quarter.
We are also impressed with the company's strategic acquisitions
in the economically diverse markets, constituting the Southwest,
Midwest and Rocky Mountain states. Notably, 64% of BOK
Financial's consolidated net income for the first quarter of 2013
was derived from overseas markets.
Over the last 60 days, the Zacks Consensus Estimate for 2013
moved north by 4% to $4.88. For 2014, the Zacks Consensus
Estimate rose 3% to $4.80 over the same time period. As a result,
BOK Financial currently carries a Zacks Rank #2 (Buy).
However, we are concerned about the company's top-line growth and
margins, which continue to be impacted by the low rate
environment and sluggish economic recovery. Additionally,
regulatory issues are expected to limit the company's flexibility
with respect to business investments.
Other Banks Worth Considering
Other banks in the same sector that are worth considering include
Farmers Capital Bank Corporation
First M&F Corporation
). All these 3 companies carry a Zacks Rank #1 (Strong Buy).