Old National Bank (ONB)
National Bank is one of
those companies that you probably never heard of and if it weren’t for
and the warrants that were issued in conjunction with TARP, I would have most likely overlooked it as well.
in 2009, ONB was given a
gracious gift by the government in the form of a cheap buyback of their
warrants. In short, the bank was able to buy back their
stock warrants that were owned by the treasury for about 20% of their
value, saving them millions of dollars. This ended up costing the
all worked out well for this regional bank.
years later, ONB is being
recognized by the Ethisphere Institute as one of the World's Most
Companies (not that they did anything wrong with TARP) and has been
strong earnings results over the past year. In the financial
sector, regionals like ONB are sometimes preferred because they don't
typically carry the same risks as thier much larger multi-national
Headquartered in Evansville, Indiana, Old National
Bancorp is the largest financial services bank holding company
Indiana with assets of $8.6 billion. The company boasts a 178-year
solid performance as an Indiana bank.
They own multiple financial services operations in
Indiana, Illinois, and Kentucky and offer a range of financial services
include commercial and retail banking, trust, brokerage, correspondent
In January, ONB Old National Bancorp increased their
cash dividend 28.6% to 09 cents per quarter
and approved a 2 million share stock repurchase plan for the next year.
ONB is a small-cap (1.20 billion) company that is trading at about
forward (expectations for next quarter) earnings and has a PEG ratio of
3.2. ONB has been a Zacks Rank 1 strong buy since April
sales increased 36% compared to the same period in 2010; earnings
from $0.44 in FY2010 to $0.76 in FY2011.
They are expected to earn $0.99 for the full year (FY2012) according to
the Zacks Consensus Estimate.
Of the 11 analysts who cover Old
National, the consensus is for the company to grow earnings by 30.38%
current year (FY2012) and roughly 9% in FY2013. The financial
company has exceeded analysts’ expectations to the upside 4 quarters in
a row; with
an average upside surprise of 26.29% over the past year.
In terms of the magnitude of
analyst estimate trends, we are seeing all of the consensus estimates
or higher than they were 90 days ago for the current and next quarter
as FY2012 and FY2013. Positive adjustments to earnings estimates have
minor. ONB is expected to earn 24 cents
when they report on April 30th.
Performance & Technicals
Old National’s stock has risen over 50% since October 2011 lows. The
only breached its 50 moving average twice since eclipsing it on October
still remain above both the 50 and 200 day moving averages of $12.40
respectively. Look for support at both
of those levels and in between them at $11.70 area
is moderate and has been averaging 550k daily. ODFL
has outperformed the S&P 500’s performance over the past year
by more than 13%. It lagged it by almost 2% in the past 3
months, but outperformed the index last month by almost 3%.
A Levy is the Momentum Stock Strategist for Zacks.com. He is also the
charge of the market-beating Zacks
Whisper Trader Service.