Shares of Southern Missouri Bancorp (
SMBC Quick Quote SMBC - Free Report) have been strong performers lately, with the stock up 3.3% over the past month. The stock hit a new 52-week high of $42.22 in the previous session. Southern Missouri Bancorp has gained 35.7% since the start of the year compared to the 15.9% move for the Zacks Finance sector and the 27.1% return for the Zacks Financial - Savings and Loan industry. What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on April 26, 2021, Southern Missouri Bancorp reported EPS of $1.27 versus consensus estimate of $1.01 while it beat the consensus revenue estimate by 6.03%.
For the current fiscal year, Southern Missouri Bancorp is expected to post earnings of $4.77 per share on $109.06 million in revenues. This represents a 59% change in EPS on a 11.87% change in revenues. For the next fiscal year, the company is expected to earn $3.9 per share on $101.77 million in revenues. This represents a year-over-year change of -18.24% and -6.68%, respectively.
Southern Missouri Bancorp may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Southern Missouri Bancorp has a Value Score of B. The stock's Growth and Momentum Scores are D and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 8.8X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.5X versus its peer group's average of 11.8X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Southern Missouri Bancorp currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Southern Missouri Bancorp passes the test. Thus, it seems as though Southern Missouri Bancorp shares could still be poised for more gains ahead.
How Does Southern Missouri Bancorp Stack Up to the Competition?
Shares of Southern Missouri Bancorp have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including Citizens Community Bancorp (
CZWI Quick Quote CZWI - Free Report) , Berkshire Hills Bancorp ( BHLB Quick Quote BHLB - Free Report) , and Meta Financial Group ( CASH Quick Quote CASH - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 14% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Southern Missouri Bancorp, even beyond its own solid fundamental situation.