We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why You Should Buy Associated Banc (ASB) Stock Right Now
Read MoreHide Full Article
Amid the global headwinds and increased regulatory oversight, investors have been shying away from the bank stocks. However, it is not prudent to ignore the industry as a whole, as stocks with strong fundamentals and upbeat outlook might significantly benefit from the expected change in interest rate environment in the near to medium-term.
Associated Banc-Corp (ASB - Free Report) , a leading Midwest bank, based in Wisconsin, warrants such top-notch performance and offers a profitable investment opportunity. The bank has seen positive earnings estimate revisions for the current quarter and year, suggesting analysts’ optimism about its growth prospects.
The Zacks Consensus Estimate for the current quarter increased 3.2% over the last 60 days to 32 cents per share. The estimate for the current year has revised 2.5% upward to $1.22 per share over the same time frame.
With a target price of $22, the stock has an upside potential of around 14% (considering yesterday’s closing price of $19.3).
Solid Organic Growth: The bank is focused on its organic growth strategy, depicted by the consistent growth in loan and deposit balances as well as net interest income (NII) over the past several years. NII has increased at a CAGR of 2.5% over the last five years (2011-2015), with the trend continuing in the first half of 2016. Total loans during the second quarter were up 8.3% year over year. Further, total deposits and revenues grew 5.3% and 2.3%, respectively. Management expects to maintain high single digit annual average loan growth and loan to deposit ratio under 100% for 2016.
Expense Control: Branch closures and staffing initiatives, enhanced automation and operational efficiencies are driving better efficiency over time. The efficiency ratio (fully tax equivalent basis) improved to 67.8% in the second quarter from 68.5% in the prior-year quarter. The company is on the path for the fifth straight year of efficiency improvement. Further, non-interest expense was down 1% from the prior-year quarter. Management expects non-interest expense to remain almost flat with the prior-year level.
Improving Credit Quality: Consistent improvement in the credit quality adds to the positives. Nonperforming assets have been steadily declining over the past several quarters. Total nonperforming assets declined 2% year over year. Further, an improvement in economic conditions will aid asset quality improvement.
Attractive Zacks Industry Rank: The Banks-Midwest space currently has a Zacks Industry Rank of 62 (top 23%).
Associated Banc-Corp currently has a Zacks Rank #2 (Buy).
Other Stocks to Consider
Some other favorably ranked stocks in the same space include Chemical Financial Corporation and Enterprise Financial Services Corp. (EFSC - Free Report) , carrying a Zacks Rank #2 and Hancock Holding Company sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Why You Should Buy Associated Banc (ASB) Stock Right Now
Amid the global headwinds and increased regulatory oversight, investors have been shying away from the bank stocks. However, it is not prudent to ignore the industry as a whole, as stocks with strong fundamentals and upbeat outlook might significantly benefit from the expected change in interest rate environment in the near to medium-term.
Associated Banc-Corp (ASB - Free Report) , a leading Midwest bank, based in Wisconsin, warrants such top-notch performance and offers a profitable investment opportunity. The bank has seen positive earnings estimate revisions for the current quarter and year, suggesting analysts’ optimism about its growth prospects.
The Zacks Consensus Estimate for the current quarter increased 3.2% over the last 60 days to 32 cents per share. The estimate for the current year has revised 2.5% upward to $1.22 per share over the same time frame.
With a target price of $22, the stock has an upside potential of around 14% (considering yesterday’s closing price of $19.3).
ASSOC BANC CORP Price
ASSOC BANC CORP Price | ASSOC BANC CORP Quote
Factors Making the Stock an Attractive Pick
Solid Organic Growth: The bank is focused on its organic growth strategy, depicted by the consistent growth in loan and deposit balances as well as net interest income (NII) over the past several years. NII has increased at a CAGR of 2.5% over the last five years (2011-2015), with the trend continuing in the first half of 2016. Total loans during the second quarter were up 8.3% year over year. Further, total deposits and revenues grew 5.3% and 2.3%, respectively. Management expects to maintain high single digit annual average loan growth and loan to deposit ratio under 100% for 2016.
Expense Control: Branch closures and staffing initiatives, enhanced automation and operational efficiencies are driving better efficiency over time. The efficiency ratio (fully tax equivalent basis) improved to 67.8% in the second quarter from 68.5% in the prior-year quarter. The company is on the path for the fifth straight year of efficiency improvement. Further, non-interest expense was down 1% from the prior-year quarter. Management expects non-interest expense to remain almost flat with the prior-year level.
Improving Credit Quality: Consistent improvement in the credit quality adds to the positives. Nonperforming assets have been steadily declining over the past several quarters. Total nonperforming assets declined 2% year over year. Further, an improvement in economic conditions will aid asset quality improvement.
Attractive Zacks Industry Rank: The Banks-Midwest space currently has a Zacks Industry Rank of 62 (top 23%).
Associated Banc-Corp currently has a Zacks Rank #2 (Buy).
Other Stocks to Consider
Some other favorably ranked stocks in the same space include Chemical Financial Corporation and Enterprise Financial Services Corp. (EFSC - Free Report) , carrying a Zacks Rank #2 and Hancock Holding Company sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>