Pinnacle Financial Partners Inc.
(PNFP - Snapshot Report
) has enjoyed upward earnings estimate revisions for 2012 and 2013 over the last 60 days, following a strong third-quarter report in mid October that included its third straight positive earnings surprise. This regional bank hit its 52 week high on October 18 and achieved a Zacks #1 Rank (Strong Buy) status on October 20. With a years return of approximately 23.4% and a long-term expected earnings growth rate of 12.5%, the stock is a solid growth pick.
Solid Q3 Results
On October 16, Pinnacle Financial reported third quarter earnings of 33 cents per share, outpacing the Zacks Consensus Estimate by 10.0%. The better-than-expected results were predominantly driven by top line growth, lower operating costs and a drop in provisions for loan losses. In the year-ago quarter, PNFP reported 72 cents.
Net interest income climbed 6.7% year over year to $40.9 million, while non-interest income increased 3.5% to $10.4 million. Moreover, the net interest margin expanded 18 basis points to 3.78%, and non-interest expenses declined 5.9% to $33.6 million.
Credit metrics continued to improve at Pinnacle Financial. Provisions for loan losses were $1.4 million, plummeting 61.1% from the year-ago quarter with net charge-offs exhibiting a downward trend as well. Net charge-offs were $1.9 million, declining 66.2% from $5.7 million in the prior-year quarter.
Earnings Estimates Advancing
Over the past 60 days, the Zacks Consensus Estimate for 2012 advanced 4.8% to $1.10 per share with 7 of 8 estimates moving higher. For 2013, the Zacks Consensus Estimate increased 5.6% to $1.32 over the same time frame, as 8 of 9 estimates moved upward.
The Zacks Consensus Estimate for 2012 reflects year-over-year growth of about 71.1%, while the expected growth rate for 2013 is 20.7%.
Shares of Pinnacle Financial currently trade at 17.4x 12-month forward earnings, almost in line with the peer group average. Its price to book ratio of 0.98 is at a 13% discount to the industry median of 1.13. The company has a trailing 12-month ROE of 5.8%, compared with the peer group average of 7.3%.
The stock has been continuously outperforming its 200 days moving average over the past year, exhibiting steadfast growth. Moreover, the stock is trading almost ahead of the S&P 500 over the same time frame.
Headquartered in Nashville, Tennessee, Pinnacle Financial is a bank holding company and conducts its primary operations through its wholly-owned subsidiary, Pinnacle National Bank. Incorporated in 2000, the company conducts its businesses through 29 offices in eight Middle Tennessee counties and 3 offices in Knoxville. The company has a market cap of about $659.9 million. Capital City Bank Group Inc. (CCBG) and Farmers Capital Bank Corporation (FFKT) are the other Zacks #1 Rank (Strong Buy) stocks in the same industry.
Want More of Our Best Recommendations?
Zacks' Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Then each week he hand-selects the most compelling trades and serves them up to you in a new program called Zacks Confidential.