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Why SB Financial (SBFG) Should be Added to Your Portfolio
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Amid the coronavirus pandemic, it seems to be a wise idea to add SB Financial Group, Inc. (SBFG - Free Report) stock to your portfolio now, given its underlying strength and solid growth prospects. The company has been undertaking several efforts to improve efficiency and optimize operations.
Further, the Zacks Consensus Estimate for the current-year and next-year earnings has moved upward over the past 60 days, respectively, reflecting analysts’ optimism regarding its earnings growth potential. Thus, the stock currently sports a Zacks Rank #1 (Strong Buy).
Shares of SB Financial have lost 15.7% in the past six months compared with the industry’s fall of 31.3%.
Why is SB Financial a Golden Egg?
Revenue Strength: The company has witnessed a rise in net revenues over the last three years. Total revenues are projected to grow at a rate of 8.3% in 2020 (compared with the nil industry average). This upward trend is anticipated to be supported by a decent lending scenario and SB Financial’s efforts to grow its fee income.
Earnings per Share Growth: The company has witnessed a rise in earnings over the last three years and SB Financial’s earnings for 2020 are projected to increase 4.6%. This earnings momentum is likely to continue in the near term, as reflected by the company’s impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters, met in one and missed in the other.
Steady Capital-Deployment Activities: The company remains committed to enhancing its shareholders’ value. In 2019, the board authorized the repurchase of up to 400,000 shares of its common stock. Further, the bank has been actively paying common stock dividends for years, with the latest hike in April 2020.
Strong leverage: SB Financial’s debt/equity ratio is 0.12, compared with the industry average of 0.40, displaying a lower debt burden relative to the industry. It highlights the financial stability of the company even in an unstable economic environment.
Superior Return on Equity (ROE): SB Financial’s trailing 12-month ROE reflects its superiority in terms of utilizing shareholder funds compared with the peers. The company has an ROE of 9.73%, higher than the industry average of 8.79%.
Stock seems undervalued: With respect to the price/cash flow and price-to-earnings (F1) ratios, SB Financial seems undervalued. It has a P/CF ratio of 5.49 and a P/E ratio of 9.91, both of which are below the respective industry average of 7.49 and 11.35.
Also, the stock has a Value Score of B. The Value Style Score condenses all valuation metrics into one actionable score that helps investors steer clear of ‘value traps’ and identify stocks that are truly trading at a discount. Our research shows that stocks with the combination of a Style Score of A or B, and carrying a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Other Stocks to Consider
Tradeweb Markets Inc (TW - Free Report) has witnessed upward earnings estimate revisions for 2020 over the past 60 days. Moreover, this Zacks #1 Ranked stock has gained 52.1% over the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.
GAIN Capital Holdings, Inc.’s current-year earnings estimate moved north in 60 days’ time. Further, the company’s shares have surged 45.6% over the past six months. At present, it holds a Zacks Rank of 2.
Mackinac Financial Corporation has witnessed upward earnings estimate revision for the ongoing year in the past 60 days. This Zacks #2 Ranked stock has depreciated 39.7% over the past six months.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Why SB Financial (SBFG) Should be Added to Your Portfolio
Amid the coronavirus pandemic, it seems to be a wise idea to add SB Financial Group, Inc. (SBFG - Free Report) stock to your portfolio now, given its underlying strength and solid growth prospects. The company has been undertaking several efforts to improve efficiency and optimize operations.
Further, the Zacks Consensus Estimate for the current-year and next-year earnings has moved upward over the past 60 days, respectively, reflecting analysts’ optimism regarding its earnings growth potential. Thus, the stock currently sports a Zacks Rank #1 (Strong Buy).
Shares of SB Financial have lost 15.7% in the past six months compared with the industry’s fall of 31.3%.
Why is SB Financial a Golden Egg?
Revenue Strength: The company has witnessed a rise in net revenues over the last three years. Total revenues are projected to grow at a rate of 8.3% in 2020 (compared with the nil industry average). This upward trend is anticipated to be supported by a decent lending scenario and SB Financial’s efforts to grow its fee income.
Earnings per Share Growth: The company has witnessed a rise in earnings over the last three years and SB Financial’s earnings for 2020 are projected to increase 4.6%. This earnings momentum is likely to continue in the near term, as reflected by the company’s impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters, met in one and missed in the other.
Steady Capital-Deployment Activities: The company remains committed to enhancing its shareholders’ value. In 2019, the board authorized the repurchase of up to 400,000 shares of its common stock. Further, the bank has been actively paying common stock dividends for years, with the latest hike in April 2020.
Strong leverage: SB Financial’s debt/equity ratio is 0.12, compared with the industry average of 0.40, displaying a lower debt burden relative to the industry. It highlights the financial stability of the company even in an unstable economic environment.
Superior Return on Equity (ROE): SB Financial’s trailing 12-month ROE reflects its superiority in terms of utilizing shareholder funds compared with the peers. The company has an ROE of 9.73%, higher than the industry average of 8.79%.
Stock seems undervalued: With respect to the price/cash flow and price-to-earnings (F1) ratios, SB Financial seems undervalued. It has a P/CF ratio of 5.49 and a P/E ratio of 9.91, both of which are below the respective industry average of 7.49 and 11.35.
Also, the stock has a Value Score of B. The Value Style Score condenses all valuation metrics into one actionable score that helps investors steer clear of ‘value traps’ and identify stocks that are truly trading at a discount. Our research shows that stocks with the combination of a Style Score of A or B, and carrying a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Other Stocks to Consider
Tradeweb Markets Inc (TW - Free Report) has witnessed upward earnings estimate revisions for 2020 over the past 60 days. Moreover, this Zacks #1 Ranked stock has gained 52.1% over the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.
GAIN Capital Holdings, Inc.’s current-year earnings estimate moved north in 60 days’ time. Further, the company’s shares have surged 45.6% over the past six months. At present, it holds a Zacks Rank of 2.
Mackinac Financial Corporation has witnessed upward earnings estimate revision for the ongoing year in the past 60 days. This Zacks #2 Ranked stock has depreciated 39.7% over the past six months.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>