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First Bancorp Upped to Strong Buy - Analyst Blog

By: Zacks.com
Posted: 12/26/2013 2:55:00 PM
Referenced Stocks: CHCO;FBNC;NBCB;OABC

On Dec 24, Zacks Investment Research upgraded First Bancorp ( FBNC ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

First Bancorp witnessed rising earnings estimates on the back of solid earnings results. This bank holding company delivered positive earnings surprises in 3 of the last 4 quarters with an average beat of 11.8%. The long-term expected earnings growth rate for this stock is 10%.   

In the last reported quarter, First Bancorp's non-GAAP earnings came in at 30 cents per share, exceeding the Zacks Consensus Estimate by 20% and the year-ago earnings by 36.4%.

Lower provisions for loan losses, and lower foreclosed property losses and write-downs largely aided the outperformance.

While total non-interest income surged 100% in the third quarter, provision for loan losses on non-covered loans witnessed improvement.  First Bancorp also has a sturdy capital position.

First Bancorp's inorganic story seems impressive with Four Oaks Banks & Trust Company, generating additional $16 million of loans and $57 million of deposits for First Bancorp.

With respect to returning value to shareholders, the company regularly pays back its shareholders.  Its dividend yields 1.91%.

These positives prompted the Zacks Consensus Estimate for 2013 to witness an 11% increase to $1.00 per share, as most of the estimates were revised higher over the last 60 days. For 2014 too, the Zacks Consensus Estimate moved north by 19.6% to $1.22 per share, as most of the estimates were also revised higher over the same time frame.

Other Stocks to Consider

Other players in the banking industry, which look attractive at current levels, include City Holding Co . ( CHCO ), First NBC Bank Holding Company ( NBCB ) and Omniamerican Bancorp, Inc . ( OABC ).  All these stocks hold the same Zacks Rank as First Bancorp.



CITY HLDGS CO (CHCO): Free Stock Analysis Report

FIRST BCP-NC (FBNC): Free Stock Analysis Report

FIRST NBC BANK (NBCB): Free Stock Analysis Report

OMNIAMERICAN BC (OABC): Get Free Report

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Zacks Investment Research