On Aug 3, 2013, Zacks Investment Research upgraded OFG Bancorp (OFG - Free Report) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
OFG Bancorp has been witnessing rising earnings estimates on the back of strong second-quarter results. Moreover, the company has an expected long-term earnings growth rate of 8.00%.
On Jul 22, 2013, OFG Bancorp reported second-quarter earnings of 68 cents per share, significantly surpassing the Zacks Consensus Estimate as well as the prior-quarter earnings of 37 cents.
The sequential improvement was driven by top-line growth, partially offset by higher operating expenses. Moreover, asset quality and capital ratios showed improvement.
OFG Bancorp’s total revenue came in at $113.2 million, up 9.1% from $103.7 in the prior quarter. However, total expenses increased 3.7% to $63.5 million.
Moreover, OFG Bancorp’s asset quality showed an improvement in the reported quarter. Non-performing loans stood at $88.5 million as of Jun 30, 2013 compared with $130.5 million as of Mar 31, 2013. Allowance for loans and lease losses as a percentage of loans held for investments was 2.57% as of Jun 30, 2013 compared with 2.89% as of Mar 31, 2013.
Capital ratios also showed improvement. As of Jun 30, 2013, Tier 1 common ratio stood at 9.85% compared with 9.20% as of Mar 31, 2013. Tier 1 risk-based capital ratio was 13.79% as of Jun 30, 2013 compared with 13.01% as of Mar 31, 2013. Total risk-based capital ratio stood at 15.83% as of Jun 30, 2013 compared with 15.03% as of Mar 31, 2013.
Over the last 30 days, the Zacks Consensus Estimate for 2013 went up by 21.4% to $1.87 per share. However, for 2014, the Zacks Consensus Estimate remained stable at $1.97 per share over the same time frame.
Other Stocks to Consider
Other stocks that are also worth considering with a Zacks Rank #1 (Strong Buy) include CNB Financial Corp. (CCNE - Free Report) , Eagle Bancorp, Inc. (EGBN - Free Report) and Metro Bancorp, Inc. .