Back to top

Press Releases

The Zacks Analyst Blog Highlights: HSBC Holdings Plc, PNC Financial Services Group, Royal Bank of Canada, Flagstar Bancorp and BankAtlantic Bancorp

PNC RY FBC

 ZacksTrade Now

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

For Immediate Release

Chicago, IL – December 21, 2011 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include HSBC Holdings Plc ( , PNC Financial Services Group Inc. ( (PNC - Analyst Report), Royal Bank of Canada ( (RY - Snapshot Report), Flagstar Bancorp Inc. ( (FBC - Snapshot Report) and BankAtlantic Bancorp Inc. ( .

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday’s Analyst Blog:

China Tries Deflating Realty Bubble

The Chinese government is attempting to calm the country’s overheated property market. Goaded by measures such as ownership restrictions on property and taxes, home prices declined in big cities in November. But this is also a tell-tale sign of China’s flagging growth. China’s Central Bank had recently lowered the cash reserve ratio to help commercial banks push lending and revive the economy.

Last month, the World Bank identified four major risks to China’s financial markets in its Financial Sector assessment. Two of these were disintermediation or lending outside the formal banking sector and high real estate and commodity prices. Non-formal lending is partly to blame for the real estate asset bubble.

The second largest economy in the world after the US, China is projected to grow at 8.8% in 2012, but less than 9.3% in 2011. The Asian Development Bank had earlier projected a growth rate of 9.1% for 2012. China had grown at 9.7% since Deng Xiaoping’s market reforms began in 1978-79. Growth accelerated to 11% during 2003-07. Between 2008 and 2009, the average GDP growth was 9.4%. In 2010, China grew by 10.3%.

In recent times, the Asian powerhouse’s economic activity has been fragile. The Purchase Managers Index (PMI) of HSBC Holdings Plc ( for China’s Services sector fell to 52.5 in November from 54.1 in October – the slowest in three months.

China’s official PMI for the non-manufacturing sector touched 49.7 in November, significantly below 57.7 recorded in October according to the China Federation of Logistics and Purchasing. The country’s official manufacturing index declined to 49.0 in November from 50.4 in October.

Fed Nod to PNC-RBC Deal

PNC Financial Services Group Inc. ( (PNC - Analyst Report) received the approval from the Federal Reserve to acquire RBC Bank (USA), the U.S. retail banking subsidiary of Royal Bank of Canada ( (RY - Snapshot Report). The approval takes PNC Financial a step nearer the completion of the deal, slated for the first quarter of 2012.

In June 2011, PNC Financial announced its plan to purchase RBC Bank (USA) for $3.45 billion. The acquisition would help PNC Financial to expand its footprint in the Southeast markets. It would also make PNC Financial the fifth among U.S. banks, with 2,870 branches. PNC Financial expects the acquisition to be immediately accretive to earnings (excluding integration costs) upon closing.

Recently, PNC Financial has been notified that the Board of Governors of the Federal Reserve System had no objection to the proposed revisions to the capital actions submitted by the company as these pertain to the acquisition of RBC Bank (USA).

Accordingly, the company does not plan to issue any share of PNC common stock as part of the consideration payable to Royal Bank of Canada at closing, or to repurchase any PNC Financial common share in 2011.

PNC in Expansion Mode

Of late, PNC Financial completed acquiring the 27-branch retail bank franchise in Georgia from Flagstar Bank, a subsidiary of Flagstar Bancorp Inc. ( (FBC - Snapshot Report). Flagstar Bank sold the leases associated with the branches and the associated businesses and retail deposits worth approximately $210 million at the closing.  PNC paid the Bank net book value of the acquired real estate plus fixed and other personal assets associated with the branches. The deal is a strategic fit for PNC Financial as it will expand operations in Atlanta and add to its competitive edge.

With over 70 branches located in the Atlanta metro area, including those that it plans to add from its pending acquisition of RBC Bank (USA), this purchase would aid in expanding its retail banking business. It would also leverage its corporate banking and wealth management prospects.

In mid-2011, PNC Financial also completed the acquisition of 19 branches from a subsidiary of BankAtlantic Bancorp Inc. ( . Additionally, two related facilities in the Tampa - St. Petersburg area and associated deposits were also handed over to PNC as part of the sale.

Our Take

PNC's continued strengthening of balance sheet, with focus on risk and expense management, should propel its earnings ahead. Benefits from the 2008 National City acquisition continue to exceed the company's expectations. We also believe that the company's latest acquisition spree would be accretive to its revenue.

Yet, the top-line headwind is expected to remain in the near term, with continued soft demand for loans and a low interest rate environment. Regulatory issues also remain a concern.

PNC shares maintain a Zacks #3 Rank, which translates into a short-term Hold recommendation. Considering its fundamentals, we also have a Neutral recommendation on the stock.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Follow us on Twitter: http://twitter.com/zacksresearch

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com

http://www.zacks.com

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.84 +7.90%
BOFL HOLDING BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%