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On Nov 26, Zacks Investment Research upgraded BofI Holding, Inc. (BOFI - Snapshot Report) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

BofI Holding has been witnessing rising earnings estimates following the announcement of strong fiscal first-quarter 2014 results. Moreover, the bank has delivered a strong year-to-date return of 166.0%.

BofI Holding reported fiscal first-quarter (ended Sep 30) results on Nov 5. Earnings per share of 85 cents were in line with the Zacks Consensus Estimate and increased 26.9% year over year. Results benefited from increased revenues, partially offset by higher operating expenses.

Net interest income rose 25.0% year over year to $28.1 million. Moreover, non-interest income increased 3.2% to $7.0 million. On the flip side, non-interest expense rose 25.9% from the prior-year quarter to $14.5 million.

Further, asset quality continued to show improvement. Nonperforming assets as a percentage of total loans decreased 27 basis points from the prior-year quarter to 0.55%. Provision for loan losses was $0.5 million, significantly down from $2.6 million in the year-ago quarter.

Additionally, in September, BofI Holding completed the acquisition of nearly $173 million in deposits from Principal Bank.

Additionally, following the earnings release, the Zacks Consensus Estimate for fiscal 2014 increased nearly 1% to $3.68 per share. Similarly, for fiscal 2015, the Zacks Consensus Estimate advanced 6.2% to $4.30 per share over the same time period.

Solid year-to-date returns and favorable estimate revisions stimulated the rank upgrade.

Other Stocks to Consider

While we prefer BofI Holding, other stocks carrying a Zacks Rank #1 include SVB Financial Group (SIVB - Analyst Report), Glacier Bancorp Inc. (GBCI - Snapshot Report) and TriCo Bancshares (TCBK - Snapshot Report).

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