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What Makes TCF Financial (TCF) Attractive to Investors Now?

Improving operating backdrop, rising rate environment, expected tax benefit from the recently implemented tax bill and strengthening domestic economy are anticipated to continue supporting banking stocks. Keeping this in mind, we have selected TCF Financial CorporationTCF for your portfolio.

It's a good idea to add stocks with robust fundamentals and long-term growth opportunities to your portfolio, at the current level. TCF Financial is one such stock that has been witnessing upward estimate revisions, reflecting analysts' optimism about its future prospects. Over the last 30 days, the Zacks Consensus Estimate for 2017 and 2018 inched up 1.1% and 2.1%, respectively.

Further, shares of this Zacks Rank #1 (Strong Buy) stock have gained around 27.7% in six months' time, outperforming 3.6% growth recorded by the industry .

With $23 billion in assets as of Sep 30, 2017, TCF Financial has a number of other aspects that make it an attractive investment option.

5 Reasons Why TCF Financial is a Must Buy

Earnings Strength: TCF Financial witnessed historical (3-5 years) earnings per share growth of 11.69% compared with 7.35% growth recorded by the industry. In addition, the company's estimated long-term EPS growth rate of 8.25% promises rewards for investors.

Revenue Growth: TCF Financial continues to make steady progress toward improving its top line, with sales recording 4-year compounded annual growth rate (CAGR) of around 2.5% during 2013-2016. Further, the company's projected sales growth of nearly 3% for 2017 indicates constant upward momentum in revenues.

Expansion Moves: TCF Financial has been focused on expansion and digitalization of its services, as per the current demand of customers. In February 2016, the company announced its plans to shut down 33 retail branches located inside the Jewel-Osco grocery stores in Chicago and substitute these branches with advanced ATMs. The new agreement is in line with TCF Financial's strategy to fortify its footprint in the Chicago region. Apart from branch closure and increasing ATM locations, the agreement also calls for improvement of retail branches and digital platforms.

Leverage: TCF Financial's debt/equity ratio is pegged at 0.59 against the S&P 500 average of 0.70, reflecting lower debt burden compared with the industry. It highlights the company's sound financial flexibility.

Stock Looks Undervalued: The stock currently has a Value Score of B. The Value Score condenses all valuation metrics into one actionable score which helps investors steer clear of "value traps" and identify stocks that are truly trading at a discount. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.

Other Stocks to Consider

Legg Mason Inc. LM has been witnessing upward estimate revisions for the past seven days. Also, the company's shares have returned nearly 9% over the past six months. It flaunts a Zacks Rank of 1. You can see the complete list of today's Zacks #1 Rank stocks here .

Federated Investors Inc. FII has been witnessing upward estimate revisions for the last 60 days. The company's shares have gained 23.9% in six months. It sports a Zacks Rank of 1.

Artisan Partners Asset Management Inc. APAM has been witnessing upward estimate revisions for the past month. Additionally, the stock has gained more than 22% in six months. It currently carries a Zacks Rank of 2.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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