QCRH: Fourth Quarter EPS Up 40% and Above Our
Estimate
By Ann Heffron, CFA
QCR Holdings, Inc. (NasdaqGM:
QCRH
)
posted fourth quarter diluted EPS of $0.49, up 40% from the $0.35
EPS reported last year. Compared to the year-ago quarter, fourth
quarter results were boosted by a gain in noninterest income on
the back of strong 20%-plus increases in trust department fees
and investment management & advisory fees, a one-fourth
reduction in the loan loss provision, an almost 4-point drop in
the effective tax rate to 24.4%, and preferred dividends that
were down $0.2 million, or 21%, from a year ago, reflecting
changes in QCRH's capital structure.
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QCRH 2-6-13
Diluted EPS came in $0.02 above our $0.47 per share estimate,
principally the result of an effective tax rate of 24.4% that was
lower than our 25.0% estimate and a reduction in average diluted
shares outstanding compared to our expectation of a slight
increase.
For the year, QCRH earned $9.1 million, or $1.85 per diluted
share, up 63% from the $5.6 million, or $1.17 per diluted share
in 2011, which excludes a one-time discount accretion on the
redemption of the Series D preferred stock. Primary contributors
to this growth were a 6 ½% gain in net interest income on a 7%
increase in average interest-earning assets combined with a 2
basis-point rise in the net interest margin to 3.10%, a one-third
reduction in the loan loss provision, strong control over
operating expenses, a 2-point decline in the effective tax rate
to 25.7%, and a $0.6 million, or 14%, fall in preferred
dividends, partly offset by a 5% slide in noninterest income.
Nonperforming loans rose modestly during the quarter by $1.5
million, or 6%, to $25.4 million as a few problem loans were
restructured, while foreclosed assets dropped $0.9 million, or
19%, to $4.2 million, due to the sale of several properties. As a
percentage of total loans and OREO, total nonperforming assets
fell 4 basis points sequentially to 2.29% from 2.33% at the end
of the third quarter and 106 basis points year over year from
3.35%.
For 2013, we are maintaining our diluted EPS estimate at
$2.05, up 11% over 2012.
QCR Holdings, Inc. (QCRH or the Company) is a multibank
holding company, which was founded in 1993 and is headquartered
in Moline, Illinois, with $2.1 billion in total assets at
December 31, 2012 and 10 offices. QCRH provides a broad range of
business and retail lending products and investment services
through three wholly owned, full-service banking subsidiaries
that are located in Illinois and Iowa. These subsidiaries include
Quad City Bank and Trust Company (QCBT), based in Bettendorf,
Iowa; Cedar Rapids Bank and Trust Company (CRBT), based in Cedar
Rapids, Iowa; and Rockford Bank and Trust Company (RB&T),
based in Rockford, Illinois.
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