Back to top

Analyst Blog

On Feb 27, we reiterated our Neutral recommendation on Huntington Bancshares Inc. (HBAN - Analyst Report) based on its rising revenues and healthy capital position. However, pressurized net interest margin, rising expenses and unsettling macro economic issues remain the major causes of concern. Huntington retains a Zacks Rank #3 (Hold).

Why Neutral?

Huntington’s fourth quarter 2012 earnings came in at 19 cents per share, beating the Zacks Consensus Estimate by a couple of cents. Total revenue, on a fully-taxable-equivalent (FTE) basis, came in at $737.2 million, up 14% from the year-ago quarter.

Moreover, revenues surpassed the Zacks Consensus Estimate of $702 million. Further, Huntington has delivered an average earnings surprise of 14.6% last year.

Moreover, over the last 60 days, the Zacks Consensus Estimate for 2013 hiked only by a penny. Further, opportunistic acquisitions as well as robust inorganic growth have helped the company sustain the Neutral recommendation. Extensive capital deployment activities also continue to reinforce investors’ confidence in the stock.

However, the low interest rate environment and changing regulatory landscape are expected to pressurize the net interest margin in the subsequent quarters. Further, given the sluggish market recovery, we expect any significant improvement in top line – in the foreseeable future – to remain elusive.

In addition, we remain wary of the continuously rising operating expenses. The company is trying to rein in costs and has undertaken several measures in 2012. However, we do not anticipate cost-trimming initiatives to fully control the rising costs as the company continues to expand globally, which involve numerous regulatory and legal expenses.

Other Stocks to Consider

Other banking stocks that are currently performing well include First Defiance Financial Corp. (FDEF - Snapshot Report), Bank Mutual Corp. (BKMU - Snapshot Report) and Meta Financial Group, Inc. (CASH - Snapshot Report). All these companies carry a Zacks Rank #1 (Strong Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

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 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
PLANAR SYST… PLNR 4.32 +4.10%
CENTURY ALU… CENX 22.44 +4.08%
ERBA DIAGNO… ERB 2.89 +3.58%
GTT COMMUNI… GTT 12.00 +3.00%
UNITED CONT… UAL 48.95 +2.66%