On Aug 31, Zacks Investment Research upgraded East West Bancorp, Inc. (EWBC - Free Report) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
East West Bancorp has been witnessing rising earnings estimates on the back of strong second-quarter 2013 results. Moreover, this well-known personal and commercial banking services provider delivered positive earnings surprises in 3 of the last 4 quarters with an average beat of 2.1%. The long-term expected earnings growth rate for this stock is 9%.
East West Bancorp reported its second-quarter results on Jul 17 with earnings per share of 52 cents, beating the Zacks Consensus Estimate of 51 cents by 1.96% and the year-ago earnings of 47 cents by 10.6%. Notably, the second quarter marked the ninth consecutive quarter of earnings growth for East West Bancorp.
The company maintained a strong capital position with solid loans and deposit balances during the quarter. Moreover, return on average common equity was recorded at 12.59%, up 13 basis points year over year. Provision for loan losses substantially declined 50% year over year to $8.3 million.
Moreover, expenses decreased 7.1% to $94.4 million, as compared with the prior-year period. Lower compensation and employee benefits and reduced loan related expenses primarily drove the decline.
Following second-quarter 2013 results, the Zacks Consensus Estimate for 2013 increased 2.9% to $2.10 per share on the back of all 9 upward revisions, over the last 60 days. For 2014, the Zacks Consensus Estimate advanced 5.7% to $2.23 per share with 9 of the 10 estimates moving north over the same time period.
Other Stocks to Consider
Besides East West Bancorp, other banks in the West with a Zacks Rank #1 include Glacier Bancorp Inc. (GBCI - Free Report) , Umpqua Holdings Corporation (UMPQ - Free Report) and Preferred Bank (PFBC - Free Report) .