New York Community Bancorp (NYCB - Free Report) is poised to benefit from a robust balance-sheet position. Further, improving credit quality is expected to aid its financials. However, net interest revenues have been declining despite rising rates.
The company recorded impressive growth in loans and deposits over the last five years. Recently, it reported second-quarter results, per which loans and deposits grew at quarterly rates of 1.1% and 1.4%. This is anticipated to provide liquidity, as well as boost the company’s near-term prospects.
Moreover, New York Community remains well capitalized with a tier 1 risk-based capital ratio of 12.59% as of the June-end quarter. A strong capital position will enable the company to undertake opportunistic expansions for growth.
Non-interest expenses witnessed a CAGR of 2.2% over the last four years (ended 2017). However, the company exited its mortgage banking business recently, which is predicted to bring down expenses in the near term.
Looking at the company’s price performance, its shares have lost 19.2% year to date compared with the 2.2% decline of the industry.
New York Community’s declining Net Interest Margin (NIM) was perhaps responsible for the stock’s underperformance over the past year. Rise in cost of funds and a liability-sensitive balance sheet remain major factors for this downside.
Further, lack of sufficient capital-deployment activities by the company can impact investor confidence in the stock.
The Zacks Consensus Estimate for current-year earnings remained unchanged at 81 cents, while for the next year, it declined marginally to 83 cents, over the last 30 days. New York Community currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Banner Corporation’s (BANR - Free Report) Zacks Consensus Estimate for earnings for 2018 has been revised 4.2% upward, in the last 30 days. Also, its share price has increased 12.9% in the past 12 months. The stock flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Great Southern Bancorp, Inc. (GSBC - Free Report) also sports a Zacks Rank of 1, at present. The stock’s 2018 earnings estimates moved up 5.2%, in the last 30 days. Further, the company’s shares have gained 12.8% in a year’s time.
Northwest Bancshares, Inc. (NWBI - Free Report) Zacks Consensus Estimate for earnings for the current year moved 2% north, in 30 days’ time. In the past year, shares of this Zacks #1 Ranked company have appreciated around 11%.
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