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Here's Why Independent Bank (IBCP) Stock is a Solid Pick Now

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It seems to be a wise idea to add Independent Bank Corporation (IBCP - Free Report) stock to your portfolio now, given its underlying strength and solid growth prospects amid the prevailing coronavirus crisis. The company has been undertaking a number of efforts to improve its efficiency and optimize operations.

The bank has been witnessing upward estimate revisions, reflecting analysts’ optimism about its growth prospects. Over the past 60 days, the Zacks Consensus Estimate for its 2020 and 2021 earnings moved 28.2% and 7.2% north, respectively.

Further, this Zacks Rank #2 (Buy) stock has gained 3.3% in the last three months as against the 0.1% decline of the industry.



There are a number of other aspects, which make the stock an attractive investment option.

6 Factors That Make Independent Bank an Attractive Buy

Revenue Strength: Independent Bank continues to make steady progress toward improving its top line, with sales witnessing a five-year (2015-2019) compounded annual growth rate of 13%. Further, the bank’s projected sales growth (F1/F0) of 10.73% compares favorably with the industry average of 2.2%.

Earnings Per Share Strength: Independent Bank witnessed EPS growth of 22.2% in the last three to five years compared with the broader industry’s 12.8%. Also, it recorded an earnings surprise of 45.39%, on average, over the trailing four quarters.

Steady Capital Deployment: The company is committed to enhancing its shareholders’ value. In December 2019, the board authorized the repurchase of up to 1.12 million shares of its common stock under 2020 program. Further, the bank has been actively paying common stock dividends for years, with the latest hike in January 2020.

Strong Leverage: Independent Bank’s debt/equity ratio is 0.36 compared with the industry average of 0.38, displaying a lesser debt burden relative to the industry. It highlights the company’s financial stability, even in an unstable economic environment.

Superior Return on Equity (ROE): Independent Bank’s ROE of 13.3% compared with the industry average of 9.09% highlights the company’s commendable position over its peers.

Stock seems undervalued: With respect to the price-to-cash flow and price-to-earnings (F1) ratios, Independent Bank seems undervalued. It has a P/CF ratio of 6.24 and a P/E ratio of 7.64, both of which are below the respective industry average of 7.04 and 10.57.

Also, the stock has a Value Score of B. The Value Style Score condenses all valuation metrics into one actionable score that helps investors steer clear of ‘value traps’ and identify stocks that are truly trading at a discount. Our research shows that stocks with the combination of a Style Score of A or B, and carrying a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.

Other Stocks to Consider

Principal Financial Group, Inc. (PFG - Free Report) has been witnessing upward estimate revisions for the past 60 days. Moreover, this Zacks #2 Ranked stock has rallied more than 16% in the past three months. You can see the complete list of today’s Zacks #1 Rank stocks here.

Eaton Vance Corporation (EV - Free Report) has been witnessing upward estimate revisions for the past 60 days. Further, the company’s shares have gained 16.6% in the past three months. At present, it carries a Zacks Rank of 2.

Artisan Partners Asset Management Inc. (APAM - Free Report) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has appreciated 65.2% in six months’ time. It currently carries a Zacks Rank #2.

These Stocks Are Poised to Soar Past the Pandemic

The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.

Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.

See the 5 high-tech stocks now>>

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