On May 14, 2014, Zacks Investment Research upgraded
Simplicity Bancorp, Inc.
) to Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Simplicity Bancorp's better-than-expected results in the third
quarter of fiscal 2014 as well as a dividend hike were the primary
drivers for the rating upgrade. Moreover, in three of the last four
trailing quarters, the company scripted positive earnings
surprises, with an average earnings beat of 27.6%.
On May 5, Simplicity Bancorp reported earnings of 17 cents per
share, outpacing the Zacks Consensus Estimate by 21.4%. However,
this was a penny below the prior-year quarter figure of 18 cents.
Results benefited from nil provision for loan losses, a 12.7% fall
in interest expenses and almost unchanged operating expenses. Also,
improvement in asset quality and strong capital and profitability
ratios were the other tailwinds.
Total nonperforming assets were $14.7 million, down from $16.0
million as of Jun 30, 2013. Further, allowance for loan losses was
0.69% of total loans, down 12 basis points from Jun 30, 2013 level.
On the flip side, a 4.5% decline in net interest income and a 15.4%
decrease in non-interest income was recorded.
Further, on May 1, Simplicity Bancorp announced a 12.5% rise in its
quarterly dividend to 9 cents per share. The dividend will be paid
on May 30 to shareholders of record as on May 15.
During the last 30 days, the Zacks Consensus Estimates for fiscal
2014 and fiscal 2015 have remained stable at 63 cents and 75 cents
per share, respectively.
Other Stocks to Consider
Apart from Simplicity Bancorp, other banks worth considering
Farmers Capital Bank Corporation
Capital City Bank Group Inc.
). All of these stocks sport a Zacks Rank #1.
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