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PNC Financial's Ratings Affirmed by Moody's, Outlook Stable
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Moody's Investor Service, the rating services arm of Moody's Corporation (MCO - Free Report) , affirmed the ratings for PNC Financial Services Group, Inc. (PNC - Free Report) and its subsidiaries. The outlook for the company remains stable.
Specifically, PNC Financial’s senior debt rating remains at A3. Its subsidiary bank, PNC Bank, N.A.’s deposit rating is Aa2/Prime-1 and a standalone baseline credit assessment (BCA) is a2. Further, its senior debt rating is A2 and subordinated debt ratings are A3. The bank’s counterparty risk assessments are A1(cr)/Prime-1(cr).
Looking at PNC Financial’s price performance, the stock gained 32.9% over the last six months, outperforming the Zacks categorized Major Regional Banks industry’s surge of 30.2%
Reasons Behind the Affirmation
The ratings are supported by the company’s sustainable business model, strong balance sheet and diverse sources of earnings. Notably, PNC Financial’s credit quality is impressive. Net charge-off rate remains low along with moderate nonperforming asset levels. Further, its energy portfolio amounts to just 1.3% of total loans.
Moreover, its strong asset risk profile is strengthened by management’s initiatives for loan growth and limited concentration risk. PNC Financial’s deposit base, sizable cash holdings and portfolio of high quality securities support its liquidity profile. Further, the company’s 20% stake in BlackRock, the world's largest asset manager, is considered as an advantage.
However, PNC Financial’s low net interest margin and average efficiency are reflected in its weak earnings. Also, Moody’s does not expect improvement in the company’s profits for the current year.
Factors that Can Trigger Ratings Change
PNC Financial’s standalone BCA rating can improve if it witnessed a decent improvement in earnings or capital, without any change in its risk profile.
The ratings can move downward if the company’s asset quality or profitability declines.
Are there Better Options than PNC Financial?
Currently, PNC Financial carries a Zacks Rank #3 (Hold).
Bank of Montreal witnessed an upward earnings estimate revision of 4.6% for the current year in the past 60 days. Its share price jumped 24.3%, over the past one year.
KB Financial’s earnings estimates were revised upward by 4.6% for the current year in the past 30 days. Also, its share price increased 59.6%, over the last one year.
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PNC Financial's Ratings Affirmed by Moody's, Outlook Stable
Moody's Investor Service, the rating services arm of Moody's Corporation (MCO - Free Report) , affirmed the ratings for PNC Financial Services Group, Inc. (PNC - Free Report) and its subsidiaries. The outlook for the company remains stable.
Specifically, PNC Financial’s senior debt rating remains at A3. Its subsidiary bank, PNC Bank, N.A.’s deposit rating is Aa2/Prime-1 and a standalone baseline credit assessment (BCA) is a2. Further, its senior debt rating is A2 and subordinated debt ratings are A3. The bank’s counterparty risk assessments are A1(cr)/Prime-1(cr).
Looking at PNC Financial’s price performance, the stock gained 32.9% over the last six months, outperforming the Zacks categorized Major Regional Banks industry’s surge of 30.2%
Reasons Behind the Affirmation
The ratings are supported by the company’s sustainable business model, strong balance sheet and diverse sources of earnings. Notably, PNC Financial’s credit quality is impressive. Net charge-off rate remains low along with moderate nonperforming asset levels. Further, its energy portfolio amounts to just 1.3% of total loans.
Moreover, its strong asset risk profile is strengthened by management’s initiatives for loan growth and limited concentration risk. PNC Financial’s deposit base, sizable cash holdings and portfolio of high quality securities support its liquidity profile. Further, the company’s 20% stake in BlackRock, the world's largest asset manager, is considered as an advantage.
However, PNC Financial’s low net interest margin and average efficiency are reflected in its weak earnings. Also, Moody’s does not expect improvement in the company’s profits for the current year.
Factors that Can Trigger Ratings Change
PNC Financial’s standalone BCA rating can improve if it witnessed a decent improvement in earnings or capital, without any change in its risk profile.
The ratings can move downward if the company’s asset quality or profitability declines.
Are there Better Options than PNC Financial?
Currently, PNC Financial carries a Zacks Rank #3 (Hold).
A couple of better-ranked finance stocks in the same space are Bank of Montreal (BMO - Free Report) and KB Financial Group Inc. (KB - Free Report) . Both these stocks sport a Zacks Rank #1 (Strong Buy). You can the complete list of today’s Zacks #1 Rank stocks here.
Bank of Montreal witnessed an upward earnings estimate revision of 4.6% for the current year in the past 60 days. Its share price jumped 24.3%, over the past one year.
KB Financial’s earnings estimates were revised upward by 4.6% for the current year in the past 30 days. Also, its share price increased 59.6%, over the last one year.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>