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Can Bryn Mawr Bank (BMTC) Run Higher on Rising Earnings Estimates?

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Bryn Mawr Bank (BMTC - Free Report) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company.

Analysts' growing optimism on the earnings prospects of this bank holding company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- has this insight at its core.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For Bryn Mawr Bank, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.

The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:

12 Month EPS

Current-Quarter Estimate Revisions

The earnings estimate of $0.65 per share for the current quarter represents a change of +216.07% from the number reported a year ago.

The Zacks Consensus Estimate for Bryn Mawr Bank has increased 6.01% over the last 30 days, as two estimates have gone higher compared to no negative revisions.

Current-Year Estimate Revisions

For the full year, the company is expected to earn $2.67 per share, representing a year-over-year change of +62.8%.

In terms of estimate revisions, the trend for the current year also appears quite encouraging for Bryn Mawr Bank. Over the past month, three estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 8%.

Favorable Zacks Rank

The promising estimate revisions have helped Bryn Mawr Bank earn a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

While strong estimate revisions for Bryn Mawr Bank have attracted decent investments and pushed the stock 8% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.


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