First Financial Upped to Strong Buy

On Feb 22, Zacks Investment Research upgraded First Financial Holdings Inc. ( FFCH - Snapshot Report ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

First Financial has been witnessing rising earnings estimates on the back of strong fourth-quarter 2012 results. Moreover, this well-known integrated financial solutions provider delivered positive earnings surprises in the last 4 quarters with an average beat of 26.6%. The long-term expected earnings growth rate for this stock is 7.5%

First Financial reported fourth-quarter results on Jan 24. Earnings per share came in at 41 cents, surpassing the Zacks Consensus Estimate of 31 cents by 32.3% and prior-quarter earnings of 34 cents by 20.6%.

Earnings were primarily aided by solid top-line growth of 5.9% and a 4.4% decrease in interest expense.

On Feb 20, First Financial entered into a merger agreement with SCBT Financial Corporation ( SCBT - Snapshot Report ) to form a combined entity. Upon completion of the deal, the combined company will have about $8.3 billion in total assets, $6.9 billion in total deposits and $6.1 billion in total loans. The agreement is anticipated to close in the third quarter of 2013, subject to certain customary conditions.

The Zacks Consensus Estimate for 2013 increased 4.5% to $1.16 per share as most of the estimates were revised higher over the last 30 days. For 2014, 2 of the 7 estimates were revised higher over the same time frame, lifting the Zacks Consensus Estimate by 6.5% to $1.14 per share.

Other Stocks to Consider

Besides First Financial, other stocks in the same sector with a Zacks Rank #1 include Riverview Bancorp Inc. ( RVSB ) and Center Bancorp Inc. ( CNBC - Snapshot Report ) .