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Why Has First NBC Bank (FNBC) Tanked 67% Year to Date?
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At a time when investors are bullish on the banking stocks, given the chances of another rate hike announcement soon, there are several stocks in the industry that seem to have fallen from investors’ radar.
Today, we are bringing one such stock, First NBC Bank Holding Company , which has tumbled over 67% year to date.
Headquartered in New Orleans, LA, this Southeast bank has been witnessing negative estimate revisions for 2016 and 2017, over the last 30 days. The Zacks Consensus Estimate for 2016 plummeted 36.5% to $2.47, while for 2017 it dropped 22.3% to $2.92. A Zacks Rank #5 (Strong Sell) further confirms weakness in the stock.
One of the primary reasons for First NBC Bank stock plunging is the issue related to delayed filings of annual and quarterly reports with the Securities and Exchange Commission (“SEC”). Though the company filed its 2015 Annual Report in August end, it is yet to file its quarterly reports for the period ended Mar 31, 2016 and Jun 30, 2016.
Further, First NBC Bank restated its financial data for the years ended Dec 31, 2015, 2014, 2013, 2012 and 2011. The company had identified accounting errors related to the federal and state historic rehabilitation tax credit entities, leading to the restatement of results.
Notably, First NBC Bank had reported a loss in 2015, despite two acquisitions during the year and witnessing strong loan and deposit growth. The company’s 2015 results were significantly hurt by a drastic rise in provision for loan losses and noninterest loss.
With operating challenges continuing in 2016 as well, we believe First NBC Bank earnings will be adversely affected. The earnings downturn is likely to continue in the near term as reflected by the company’s projected EPS decline (F1/F0) of 28.9%.
Further, First NBC Bank’s debt/equity ratio stands at 0.99 compared to the industry average of 0.38, indicating high debt level.
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Why Has First NBC Bank (FNBC) Tanked 67% Year to Date?
At a time when investors are bullish on the banking stocks, given the chances of another rate hike announcement soon, there are several stocks in the industry that seem to have fallen from investors’ radar.
Today, we are bringing one such stock, First NBC Bank Holding Company , which has tumbled over 67% year to date.
Headquartered in New Orleans, LA, this Southeast bank has been witnessing negative estimate revisions for 2016 and 2017, over the last 30 days. The Zacks Consensus Estimate for 2016 plummeted 36.5% to $2.47, while for 2017 it dropped 22.3% to $2.92. A Zacks Rank #5 (Strong Sell) further confirms weakness in the stock.
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One of the primary reasons for First NBC Bank stock plunging is the issue related to delayed filings of annual and quarterly reports with the Securities and Exchange Commission (“SEC”). Though the company filed its 2015 Annual Report in August end, it is yet to file its quarterly reports for the period ended Mar 31, 2016 and Jun 30, 2016.
Further, First NBC Bank restated its financial data for the years ended Dec 31, 2015, 2014, 2013, 2012 and 2011. The company had identified accounting errors related to the federal and state historic rehabilitation tax credit entities, leading to the restatement of results.
Notably, First NBC Bank had reported a loss in 2015, despite two acquisitions during the year and witnessing strong loan and deposit growth. The company’s 2015 results were significantly hurt by a drastic rise in provision for loan losses and noninterest loss.
With operating challenges continuing in 2016 as well, we believe First NBC Bank earnings will be adversely affected. The earnings downturn is likely to continue in the near term as reflected by the company’s projected EPS decline (F1/F0) of 28.9%.
Further, First NBC Bank’s debt/equity ratio stands at 0.99 compared to the industry average of 0.38, indicating high debt level.
Stocks to Consider
Stocks in the banking industry worth a look include Hancock Holding Company , Republic Bancorp Inc. (RBCAA - Free Report) and Southern National Bancorp of Virginia Inc. . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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