Regional banks have emerged stronger from the financial crisis of 2009. This year, the sector has outperformed the S&P 500, gaining nearly 14.50%, compared to a gain of 12.30% for the S&P 500. Let's take a look at some of best performers in the sector this year.
Fifth Third Bancorp (NASDAQ:FITB): Shares of this diversified financial services company are currently trading at $15.28, up 0.56% over Monday's closing price. FITB shares are currently trading close to their 52-week high of $15.41. FITB is also trading above its 50-day and 200-day moving averages, which is a bullish signal.
FITB has seen strong momentum since the end of June, gaining more than 17%. YTD, FITB has gained more than 20%, outperforming the S&P 500.
FITB has a P/E ratio of 9.80, compared to an average P/E ratio of 12.08 for regional banks in the Midwest. FITB has a dividend yield of 2.62 and a Return on Equity of 11.44%.
With 11 Buy and 8 Outperform ratings, compared to 10 Hold and 1 Sell ratings, Wall Street is currently bullish on FITB.
As of June 30, 2012, Cincinnati, Ohio-based Fifth Third Bancorp had a Tier 1 Common Equity ratio of 9.8%.
U.S. Bancorp (NYSE:USB): Minneapolis, Minnesota-based U.S. Bancorp is one the largest regional banks in the U.S. USB is currently trading at $34, up 0.47% over Monday's closing price. USB shares are trading close to their 52-week high of $34.17.
USB has gained more than 25% YTD, outperforming the S&P 500 and the regional banking sector. USB is currently trading above its 50-day and 200-day moving averages. The stock's technical indicators are currently giving bullish signals.
USB has been facing resistance around $34. If the stock breaks through this level, there could be some upside.
USB has a P/E ratio of 12.49, which is higher than the average for regional banks based in Midwest. The stock has a dividend yield of 2.29. At 14.58%, USB has one of the highest Returns on Equity among regional banks.
USB currently has 6 Buy and 8 Outperform ratings, compared to 19 Hold and 1 Underperform ratings.
Popular Inc. (NASDAQ:BPOP): Puerto Rico-based Popular Inc. provides retail and commercial banking services in mainland U.S. and Puerto Rico. BPOP is currently trading around $17, up 1% from Monday's closing price. BPOP has been one of the best performing regional bank stocks this year, gaining more than 22% YTD.
BPOP is currently trading below its 52-week high of $23.20, which suggests that the stock has upside potential. BPOP has crossed its 50-day and 200-day moving averages, which is a bullish signal. The stock's MACD is also giving bullish signals.
BPOP has a P/E ratio of 12.71, compared to an average PE ratio of 11.98 for Foreign Regional Banks. BPOP has a Return on Equity of 3.62%.
BPOP currently has 1 Buy and 2 Outperform ratings, compared to 1 Hold rating. It has a market capitalization of $1.75 billion.
Huntington Bancshares Incorporated (NASDAQ:HBAN): The Columbus, Ohio-based regional bank has outperformed the S&P 500 and the sector this year. YTD, HBAN gained more than 23%. The stock is currently trading around $6.75, up 1.25% from Monday's closing price.
HBAN is currently trading close to its 52-week high of $6.83. The stock is trading above its 50-day and 200-day moving averages. HBAN has been gaining strong momentum since the start of August. Its MACD chart suggests that the momentum is likely to continue.
HBAN currently has a P/E ratio of 10.80, which is lower than the average P/E ratio for regional banks based in Midwest. The stock currently has a dividend yield of 2.36%. HBAN has a Return on Equity of 10.57%.
With 16 Hold ratings, Wall Street analysts are currently cautious on HBAN. The stock has 5 Buy and 2 Outperform ratings, and 2 Underperform ratings.
Regions Financial Corp. (NYSE:RF): Regions Financial Corp. is a Birmingham, Alabama-based financial holding company operating throughout the South, Midwest and Texas. RF is currently trading around $7.30, down 1.75% over Monday's closing price. YTD, RF has gained nearly 70%.
RF shares are trading closing to their 52-week high of $7.58. RF is trading well above its 50-day and 200-day moving averages.
At 24.03, RF has one of the highest P/E ratios amongst regional banks. The stock has a dividend yield of 0.55%. Both P/E ratio and dividend yield together suggest that RF is overvalued compared to other regional banks.
However, investors are willing to pay a premium for RF because of its strong balance sheet. As of June 30, 2012, RF had a Tier 1 Capital ratio of 11%. Analysts currently have 5 Buy and 8 Outperform ratings on RF stock, compared to 14 Hold and 2 Underperform ratings.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.