It seems to be a wise idea to invest in First Financial Bankshares (FFIN - Free Report) stock right now. The company is well poised for revenue growth, driven by continued improvement in loans and deposits. Moreover, it has a solid balance sheet position.
Further, the company’s earnings estimates have remained stable over the past 30 days despite gradual adverse change in operating backdrop. It currently carries a Zacks Rank #2 (Buy).
Moreover, the stock has been performing well. So far this year, shares of First Financial have rallied 6.8%, outperforming rise of 3.8% for the industry it belongs to.
What Makes First Financial a Solid Pick
Revenue strength: First Financial has been witnessing consistent improvement in revenues, driven by growth in loans and deposit balances. Over the last six years (ended 2018), total revenues recorded a compound annual growth rate (CAGR) of 10.6%.
Moreover, backed by strong balance sheet and liquidity position, the company is expected to be able to undertake inorganic expansion moves. Last year, it acquired Kingwood, TX-based Commercial State Bank, which helped boost its non-interest revenues.
Notably, the company’s revenues are projected to grow 5.1% in 2019 and 6.2% in 2020.
Earnings growth: First Financial recorded earnings growth of 9.9% over the past three to five years. This momentum is likely to continue in the near term, as reflected by the company’s projected earnings growth rate of 9.2% and 5.2% for 2019 and 2020, respectively.
Superior Return on Equity (ROE): First Financial has a ROE of 15.03% compared with the industry average of 10.48%. This indicates the company’s superiority in utilizing shareholders’ funds.
Strong leverage: First Financial’s debt/equity ratio is nil against the industry average of 0.47. The relatively strong financial health of the company will likely help it perform better than its peers in a dynamic business environment.
Other Stocks Worth Considering
The Bancorp, Inc. (TBBK - Free Report) currently sports a Zacks Rank #1 (Strong Buy). The company’s 2019 earnings estimates have moved 6.7% upward over the past 60 days. Its shares have rallied 12.1% so far this year.
The Zacks Consensus Estimate for earnings for Hilltop Holdings Inc. (HTH - Free Report) has increased 6.4% over the past 60 days. Its shares have gained 19.7% so far this year. The stock currently sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
OFG Bancorp’s (OFG - Free Report) earnings estimates for the current year have remained stable over the past 60 days. Its shares have surged 43.3% year to date. The stock presently has a Zacks Rank #1.
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