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Balanced View on BancorpSouth - Analyst Blog

Posted: 4/9/2014 4:35:00 PM
Referenced Stocks: BXS;CCBG;FFKT;IBKC

On Apr 3, 2014, we issued an updated research report on BancorpSouth, Inc. ( BXS ). This Southeast bank exhibits decent fundamentals amid a competitive banking environment.

BancorpSouth is driving operational efficiency through to its efforts to contain costs. After continuously rising non-interest expenses over the previous two years, the company managed to shrink its non-interest expenses by 2.6% year over year in 2013. Further, the company's asset quality continues to improve since the last few years.

Apart from this, the company has a healthy capital position. Driven by sound liquidity, BancorpSouth paid $11.4 million as cash dividends in 2013, boosting shareholders' confidence.

Further, BancorpSouth's fourth-quarter 2013 operating earnings of 29 cents per share outpaced the Zacks Consensus Estimate by 3.6%. Notably, the company delivered positive earnings surprises in 3 quarters of 2013 with an average beat of 6.11%.

Despite the positives, we remain cautious, owing to several issues faced by BancorpSouth that pose a threat to the company's financials. These include a declining net interest margin owing to a still low interest rate environment, lower non interest revenues and the prevailing stringent regulatory landscape.

Mixed view of the analysts' on the stock was reflected in the movement of the Zacks Consensus Estimate over the past 60 days. For 2014, it remained stable at $1.32 per share, while it advanced 1.3% to $1.55 per share for 2015.

BancorpSouth currently carries a Zacks Rank #3 (Hold).

Stocks That Warrant a Look

Capital City Bank Group Inc. ( CCBG ), IberiaBank Corp. ( IBKC ) and Farmers Capital Bank Corp. ( FFKT ) are better-ranked stocks in this space. All these stocks hold a Zacks Rank #1 (Strong Buy).

BANCORPSOUTH (BXS): Free Stock Analysis Report

CAPITAL CITY BK (CCBG): Free Stock Analysis Report

FARMERS CAP KY (FFKT): Free Stock Analysis Report

IBERIABANK CORP (IBKC): Free Stock Analysis Report

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