Salisbury Bancorp (SAL - Free Report) seems to be an attractive pick now on the back of its top-line strength and improving operating backdrop. Further, earnings strength and a strong balance sheet position are tailwinds.
These factors, along with its other activities, have secured analysts’ confidence, as reflected by 5.2% upward revision in the Zacks Consensus Estimate for current-year earnings over the past 30 days. Thus, the company carries a Zacks Rank #2 (Buy).
Also, shares of Salisbury Bancorp have gained 6.4% year to date compared with the industry’s growth of 5.4%.
Factors That Make Salisbury Bancorp an Attractive Pick
Earnings Growth: Salisbury Bancorp’s recorded an earnings growth rate of 7.5% over the last three to five years. This momentum is likely to continue, as reflected by the company’s projected earnings per share growth of 19.9% for 2019 compared with 4.9% for the industry.
Also, the company delivered a positive earnings surprise of 6% in the trailing four quarters.
Strong Organic Growth: Salisbury Bancorp’s revenues witnessed a 4.6% compounded annual growth rate over the last three years, ended 2018. The company’s projected sales growth rate of 3.1% and 6% for 2019 and 2020, respectively, indicates continued upward momentum in revenues.
Impressive Balance Sheet Growth: Salisbury Bancorp’s loans and deposits have witnessed a CAGR of 9.2% and 8.9%, respectively, over a three-year period (ended 2018). Also, both loan and deposit balances are likely to get support from an improving economy.
Valuation Looks Reasonable: Salisbury Bancorp has a P/B ratio of 1 compared with the industry average of 1.13. Also, the bank’s P/E ratio of 10.66 is below the industry average of 11.12. Based on these ratios, the stock seems undervalued. The stock currently has a Value Score of A.
Favorable VGM Score: Salisbury Bancorp has a VGM Score of B. Our research shows stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Strong Leverage: Salisbury Bancorp’s debt/equity ratio is 0.39 compared with the industry average of 0.43. The relatively strong financial health of the company will help it perform better than its peers under an unstable business environment.
Other Stocks to Consider
CNB Financial Corporation’s (CCNE - Free Report) Zacks Consensus Estimate for current-year earnings has been revised 2% upward for 2019 in the past 60 days. Also, its share price has increased 15.2% so far this year. The stock carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CB Financial Services, Inc. (CBFV - Free Report) currently carries a Zacks Rank #2. The stock’s current-year earnings estimates have been revised 1.9% upward over the past 60 days. Further, the company’s shares have jumped 1% year to date.
Bridgewater Bancshares’ (BWB - Free Report) Zacks Consensus Estimate for current-year earnings has been revised 4% upward over the past 60 days. Moreover, in the past year, its shares have gained 5.5%. Also, it carries a Zacks Rank #2.
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