Have you been paying attention to shares of First Community (
FCCO Quick Quote FCCO - Free Report) ? Shares have been on the move with the stock up 2.7% over the past month. The stock hit a new 52-week high of $23.1 in the previous session. First Community has gained 28% since the start of the year compared to the 20.3% move for the Zacks Finance sector and the 39% 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 October 20, 2021, First Community reported EPS of $0.63 versus consensus estimate of $0.48 while it beat the consensus revenue estimate by 9.99%.
For the current fiscal year, First Community is expected to post earnings of $2.02 per share on $59 million in revenues. This represents a 49.63% change in EPS on a 9.69% change in revenues. For the next fiscal year, the company is expected to earn $1.78 per share on $58.41 million in revenues. This represents a year-over-year change of -11.88% and -1.01%, respectively.
First Community 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 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.
First Community has a Value Score of A. The stock's Growth and Momentum Scores are B and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 10.8X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.6X versus its peer group's average of 13X. 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, First Community 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 First Community fits the bill. Thus, it seems as though First Community shares could have a bit more room to run in the near term.
How Does First Community Stack Up to the Competition?
Shares of First Community 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 impressive, including United Bancorporation of Alabama (
UBAB Quick Quote UBAB - Free Report) , Reliant Bancorp , and Hancock Whitney ( HWC Quick Quote HWC - 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 19% of all the industries we have in our universe, so it looks like there are some nice tailwinds for First Community, even beyond its own solid fundamental situation.