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4 Reasons Why Fifth Third (FITB) Stock is Worth a Buy Now
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During the Q2 earnings season, the Finance sector was one of the best performers. Despite inflation-related issues and increasing chances of political uncertainty, we can add some banking stocks to our portfolio based on strong fundamentals and solid long-term growth opportunities.
Fifth Third Bancorp (FITB - Free Report) is one such stock that not only beat estimates in Q2, but also has been witnessing upward estimate revisions, reflecting analysts’ optimism about its future prospects. Over the last 60 days, the Zacks Consensus Estimate for both 2017 and 2018 inched up around 1%.
Further, shares of this Zacks Rank #2 (Buy) stock have gained 1.3% so far, this year, compared with 8.3% growth recorded by the industry it belongs to.
Notably, Fifth Third has a number of other aspects that make it an attractive investment option right now.
Why Fifth Third is a Must Buy
Organic Growth: Fifth Third’s diverse revenue base will likely support its earnings growth. The company has expanded its non-interest income base, which now represents over 36% of total revenues in the first half of 2017. Furthermore, management expects fee income to increase in the near term. Additionally, the company remains focused on executing measures, including branch consolidation.
Earnings Strength: Fifth Third recorded earnings growth rate of 2.4% over the last three to five years. Also, earnings are anticipated to display an upswing in the near term, as the company’s projected EPS growth (3-5 years) is 5.8%. Also, Fifth Third recorded an average positive earnings surprise of 19.92%, over the trailing four quarters.
Superior Return on Equity (ROE): Fifth Third’s ROE of 10.4% compared with the industry’s 9.9% average highlights the company’s commendable position over its peers.
Stock is Undervalued: Fifth Third has P/E and P/B ratios of 15.14 and 1.37 compared to the S&P 500 average of 18.95 and 3.17, respectively. Based on these ratios, the stock seems undervalued.
First Commonwealth Financial’s earnings estimates for 2017 have been revised 2.6% upward, over the last 60 days. Further, in a year’s time, the company’s shares have jumped 34.7%.
FB Financial’s earnings estimates have been revised 3.2% upward for 2017, in the past 90 days. Also, its share price surged 78.2% over the last year.
Salisbury Bancorp witnessed a 2.4% upward earnings estimates revision for the current year, over the last 60 days. Moreover, in the past year, its shares have gained 47.7%
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4 Reasons Why Fifth Third (FITB) Stock is Worth a Buy Now
During the Q2 earnings season, the Finance sector was one of the best performers. Despite inflation-related issues and increasing chances of political uncertainty, we can add some banking stocks to our portfolio based on strong fundamentals and solid long-term growth opportunities.
Fifth Third Bancorp (FITB - Free Report) is one such stock that not only beat estimates in Q2, but also has been witnessing upward estimate revisions, reflecting analysts’ optimism about its future prospects. Over the last 60 days, the Zacks Consensus Estimate for both 2017 and 2018 inched up around 1%.
Further, shares of this Zacks Rank #2 (Buy) stock have gained 1.3% so far, this year, compared with 8.3% growth recorded by the industry it belongs to.
Notably, Fifth Third has a number of other aspects that make it an attractive investment option right now.
Why Fifth Third is a Must Buy
Organic Growth: Fifth Third’s diverse revenue base will likely support its earnings growth. The company has expanded its non-interest income base, which now represents over 36% of total revenues in the first half of 2017. Furthermore, management expects fee income to increase in the near term. Additionally, the company remains focused on executing measures, including branch consolidation.
Earnings Strength: Fifth Third recorded earnings growth rate of 2.4% over the last three to five years. Also, earnings are anticipated to display an upswing in the near term, as the company’s projected EPS growth (3-5 years) is 5.8%. Also, Fifth Third recorded an average positive earnings surprise of 19.92%, over the trailing four quarters.
Superior Return on Equity (ROE): Fifth Third’s ROE of 10.4% compared with the industry’s 9.9% average highlights the company’s commendable position over its peers.
Stock is Undervalued: Fifth Third has P/E and P/B ratios of 15.14 and 1.37 compared to the S&P 500 average of 18.95 and 3.17, respectively. Based on these ratios, the stock seems undervalued.
Other Stocks to Consider
Other top-ranked stocks in the same space are First Commonwealth Financial Corporation (FCF - Free Report) , FB Financial Corporation (FBK - Free Report) and Salisbury Bancorp, Inc. . All three carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
First Commonwealth Financial’s earnings estimates for 2017 have been revised 2.6% upward, over the last 60 days. Further, in a year’s time, the company’s shares have jumped 34.7%.
FB Financial’s earnings estimates have been revised 3.2% upward for 2017, in the past 90 days. Also, its share price surged 78.2% over the last year.
Salisbury Bancorp witnessed a 2.4% upward earnings estimates revision for the current year, over the last 60 days. Moreover, in the past year, its shares have gained 47.7%
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>