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Analyst Blog

Shares of Hudson City Bancorp, Inc. (HCBK - Analyst Report) reached a new 52-week high of $10.15 on Jun 9. The stock closed the session at $10.14, reflecting a solid return of 22.5% over the past \year. The trading volume for the session was 2,643,208 million shares.

The company has delivered positive earnings surprises in the trailing four quarters, with an average beat of 28.6%.

Growth Drivers

Impressive first-quarter 2014 results, including improving credit metrics, strong capital ratios and zero provision for loan losses, primarily drove the stock price.

Hudson City reported first-quarter earnings of 9 cents per share on Apr 29, beating the Zacks Consensus Estimate by 28.6%. The bottom line was however lower than 10 cents earned in the prior-year quarter.

Higher non-interest income and lower expenses aided the bottom line, which was, however, partially offset by a decline in the total interest and dividend income. The quarter witnessed no provision for loan losses versus $20.0 million in the year-ago quarter. Capital ratios improved due to an uptrend in the ratios of Tier 1 leverage capital, total risk-based capital and equity to total assets, in comparison with the prior-year quarter.

Estimate Revisions Show Mixed Results

Over the last 60 days, the Zacks Consensus Estimate for 2014 has inched up 3.7% to 28 cents per share. However, for 2015, the estimate fell around 12.5% to 28 cents per share over the same time frame.

Hudson City currently holds a Zacks Rank #3 (Hold). Some better-ranked savings and loan institutions include Anchor Bancorp (ANCB), BankFinancial Corp. (BFIN - Snapshot Report) and Cape Bancorp, Inc. (CBNJ - Snapshot Report). While Anchor Bancorp sports a Zacks Rank #1 (Strong Buy), BankFinancial Corp and Cape Bancorp hold a Zacks Rank #2 (Buy).

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