Have you been paying attention to shares of Ameris Bancorp (
ABCB Quick Quote ABCB - Free Report) ? Shares have been on the move with the stock up 11.4% over the past month. The stock hit a new 52-week high of $57.88 in the previous session. Ameris Bancorp has gained 48.4% since the start of the year compared to the 18.4% move for the Zacks Finance sector and the 39.7% return for the Zacks Banks - Southeast industry. What's Driving the Outperformance?
The stock has an impressive 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 22, 2021, Ameris Bancorp reported EPS of $1.66 versus consensus estimate of $1.12 while it beat the consensus revenue estimate by 8.46%.
For the current fiscal year, Ameris Bancorp is expected to post earnings of $5.19 per share on $1.05 billion in revenues. This represents a 19.86% change in EPS on a -3.3% change in revenues. For the next fiscal year, the company is expected to earn $4.05 per share on $1.01 billion in revenues. This represents a year-over-year change of -21.93% and -3.49%, respectively.
Ameris 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 has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb 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. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Ameris Bancorp has a Value Score of B. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 10.9X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.9X versus its peer group's average of 12.9X. 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 consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Ameris Bancorp currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
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 Ameris Bancorp passes the test. Thus, it seems as though Ameris Bancorp shares could still be poised for more gains ahead.
How Does Ameris Bancorp Stack Up to the Competition?
Shares of Ameris Bancorp have been moving higher, 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 looking good, including Synovus Financial (
SNV Quick Quote SNV - Free Report) , Hancock Whitney ( HWC Quick Quote HWC - Free Report) , and South State ( SSB Quick Quote SSB - 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 10% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Ameris Bancorp, even beyond its own solid fundamental situation.