On March 14, 2013, I was looking for a strong candidate to flag
in a top-down industry context.
I came upon the Western U.S. Regional Banks.
It enjoys a high Zacks Industry Rank at #21, up +7 in the ranks
from last week. I decided to stop there. Only one Zacks
Ranked regional bank region stands above it. That is the
Southeast region at #14, up +3.
Inside this West Region Bank industry are 41 banks. There
have been 15 positive revisions to annual earnings recently, and
only 4 negative revisions.
What really struck me is 19 of 41 banks in this group have a Zacks
Rank of #1 or #2.
Half of West Region banks are ranked at a Buy or Strong Buy
based on earnings estimates
. That has to mean a strong set of positive, regional
economic undercurrents is in play, which an investor can benefit
This Western region does benefit disproportionately from a number
of positive economic trends inside the USA.
- Housing construction and home prices are now rising well
above the national average. Industrial, Retail and
commercial has rebounded too.
- The IT industry is concentrated on the West Coast.
- This region enjoys demographic growth above the national
- Throw in fresh support from strong positive job growth
numbers. This was one of this region's concentrated problem
In light of all positive trends, this region's banking system
stands to reason as a place to find a good stock.
Take a read through the following brief descriptions of four
candidates. I chose each one based on its current Zacks Rank
(#1 or #2) and Zacks Rating (Outperform), its diverse location, and
overall sentiment scores.
I also wanted banks that reflect well the underlying fundamental
trends in play.
Note that Q1-2013 quarterly reporting arrives for these banks in
the third week of April -- a month away.
Columbia Banking System, Inc.
Zacks Rank #1 (Strong Buy) with an Outperform rating. This
bank offers a dividend yield of 2.0%, and +14% EPS growth over the
last five years. It reports quarterly earnings on April 24,
COLB is a registered bank holding company whose wholly owned
subsidiary, Columbia State Bank, It conducts a full-service
commercial banking business.
Headquartered in Tacoma, Washington, the company provides a full
range of banking services to small and medium-sized businesses,
professionals and other individuals through banking offices located
in the Tacoma metropolitan area and contiguous parts of the Puget
Sound region of Washington, as well as the Longview and Woodland
communities in southwestern Washington.
Western Alliance Bancorporation
Zacks Rank #1 (Strong Buy) with an Outperform rating. The bank
has seen notable consensus earning estimate revisions over the last
30 days. It reports earnings on April 18, 2013.
WAL is the parent company of BankWest of Nevada, Alliance Bank of
Arizona, Torrey Pines Bank, Miller/Russell & Associates, and
Premier Trust. These dynamic companies provide a broad array of
banking, leasing, trust, investment, and mortgage services to
clients in Nevada, Arizona and California.
Staffed with experienced financial professionals, these
organizations deliver a broader product array and larger credit
capacity than community banks, yet are empowered to be more
responsive to customers' needs than larger institutions.
Bridge Capital Holdings
Zacks Rank #2 with an Outperform Rating, but it was a Zacks Rank #1
a week ago. Small Cap Value stock. Supports the Info
Tech business in the Bay area. NO dividend. It reports
earnings on April 25. 2013.
BBNK is the holding company for Bridge Bank, a full-service
business bank that is dedicated to meeting the financial needs of
small and middle-market, and emerging technology businesses in the
Silicon Valley, Palo Alto, Sacramento, San Diego, and Fresno
business communities. Bridge Bank provides clients with a
comprehensive package of business banking solutions delivered
through experienced and professional bankers.
Bank of Hawaii Corporation
Zacks Rank #2 with a Neutral rating. Unlike the other banks
above, it offers a healthy 3.6% dividend. It reports on April 22,
BOH is a regional financial services company serving businesses,
consumers and governments in Hawaii, American Samoa and the West
Pacific. The company's principal subsidiary, Bank of Hawaii, was
founded in 1897 and is the largest independent financial
institution in Hawaii.
BRIDGE CAP HLDG (BBNK): Free Stock Analysis
BANK OF HAWAII (BOH): Free Stock Analysis
COLUMBIA BK SYS (COLB): Free Stock Analysis
WESTERN ALLIANC (WAL): Free Stock Analysis
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