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4 Reasons Why Colony Bankcorp (CBAN) Stock is Worth Buying Now

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Colony Bankcorp, Inc. (CBAN - Free Report) is a solid bet now due to underlying strength and healthy long-term prospects. Also, higher interest rates, decent loan demand and a strong balance sheet position augur well for this Fitzgerald, GA-based company’s future.

Further, analysts are bullish on the stock. Over the past 60 days, the Zacks Consensus Estimate for earnings has moved 5.9% and 1.5% upward for 2023 and 2024, respectively. Currently, the stock carries a Zacks Rank #2 (Buy).

Shares of Colony Bankcorp have gained 13% over the past month compared with the industry’s rise of 16.2%.

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Here are the factors that make Colony Bankcorp an attractive investment pick right now:

Balance Sheet Growth: Colony Bankcorp has displayed strong balance sheet growth. Total loans have witnessed a compound annual growth rate (CAGR) of 28% over the last two years (2020-2022). Moreover, total deposits have witnessed a CAGR of 31.3% over the last two years (2020-2022). The uptrend for both loans and deposits continued in the first quarter of 2023. Hence, decent loan demand and modest deposit inflows are likely to keep the momentum going.

Revenue Growth: Colony Bankcorp’s net revenues witnessed a CAGR of 20.7% over the last two years (2020-2022). The improvement was backed by a strong loan and deposit balance and higher interest rates. Though revenues declined in the first quarter of 2023 due to a fall in non-interest income, the momentum is expected to continue in the upcoming quarters due to higher rates, steady loan demand and deposits. Revenues are expected to grow 2.9% in 2023 and 4.5% in 2024.

Earnings Growth: Colony Bankcorp witnessed earnings growth of 3.4% in the past three to five years. While the company’s earnings are projected to fall 1.6% in 2023, the same is expected to rebound and grow 5.6% in 2024.

Encouraging Capital Deployment Activities: Colony Bankcorp is committed to enhancing shareholders’ value. The company pays quarterly dividends on a regular basis. Further, it increased dividends five times in the last five years. Also, it has an annualized dividend yield of 4.3%, considering the company’s last-day closing price of $10.14. Apart from being attractive to investors, the yield also represents a steady income stream.

CBAN has a share repurchase program in place. The company announced a new stock repurchase plan on October 2022, authorizing it to repurchase up to $12 million outstanding common stocks. As of Mar 31, 2023, $11.5 million outstanding shares were remaining for future repurchases. Such moves enhance shareholders’ value and boost investors’ confidence in the stock.

Other Bank Stocks Worth a Look

A couple of other top-ranked stocks from the banking space are BNP Paribas (BNPQY - Free Report) and First Citizens BancShares (FCNCA - Free Report) .

The Zacks Consensus Estimate for BNP Paribas’ current-year earnings has been revised 13.3% upward over the past 30 days. Its shares have gained 10.6% in the past six months. Currently, BNPQY sports a Zacks Rank #1 (Strong Buy).

First Citizens BancShares sports a Zacks Rank #1 at present. Its earnings estimates for 2023 have been revised 67.2% upward over the past 30 days. In the past six months, FCNCA’s shares have rallied 65.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.

See More Zacks Research for These Tickers

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First Citizens BancShares, Inc. (FCNCA) - free report >>

BNP Paribas SA (BNPQY) - free report >>

Colony Bankcorp, Inc. (CBAN) - free report >>

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