On Jun 10, 2013, we reiterated our long-term recommendation on
) at Neutral based on its attractive core franchisee, diverse
revenue streams and strong capital base. However, regulatory
issues coupled with fundamental pressures on the banking sector
might act as deterrents to the company's fundamentals.
U.S. Bancorp has yet again delivered impressive earnings in the
first quarter of 2013. Aided by reduced non-interest expenses and
a lower provision for credit losses, the company reported
earnings per share of 73 cents, up from 67 cents reported in the
year-ago period. However, results were in line with the Zacks
U.S. Bancorp remains one of the most profitable large-cap banks
in the industry, with a return on equity (ROE) of 16.0% and a
return on assets (ROA) of 1.65% in first-quarter 2013. With a
wide range of product offerings, the company is well poised for
organic growth. Its strong retail banking franchise and
leadership in payment processing should continue creating growth
opportunities going forward.
However, a sluggish economy that adversely affected consumer and
business spending has impacted a number of fee-based categories
over the last several quarters. Though we expect the fee-based
category to grow over time with an improvement in the economy, we
think that the progress will be tardy with the economy recovering
at a slow pace.
For U.S. Bancorp, the Zacks Consensus Estimates for 2013 and 2014
remained stable at $3.04 and $3.24 per share, respectively, over
the last 30 days. Hence, U.S. Bancorp carries a Zacks Rank #3
Other Major Banks to Consider
Some major banks that are worth considering include
The PNC Financial Services Group, Inc.
JPMorgan Chase & Co.
). All the 3 banks hold a Zacks Rank #2 (Buy).
COMERICA INC (CMA): Free Stock Analysis
JPMORGAN CHASE (JPM): Free Stock Analysis
PNC FINL SVC CP (PNC): Free Stock Analysis
US BANCORP (USB): Free Stock Analysis Report
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