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Sun, Jan. 31, 8:53 AM
- Barron’s says it’s a good time to bet on the big banks after a rocky start to the year.
- The 10 biggest U.S. banks are trading for 8x-12x 2016 estimated earnings; the S&P 500 trades at 16x.
- Exposure to distressed U.S. energy companies is manageable.
- While leading Democratic presidential candidates are pushing for a breakup of the biggest banks, that possible eventuality could be a positive since many trade below their sum-of-parts.
- The following banks all have 20% upside: Bank of America (NYSE:BAC), Citigroup (NYSE:C), JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), BB&T (NYSE:BBT), PNC (NYSE:PNC), Suntrust (NYSE:STI), U.S. Bancorp (NYSE:USB).
Barron’s also mentions Citizens Financial (NYSE:CFG) and Region’s Financial (NYSE:RF) favorably.
Tue, Jan. 26, 3:25 PM
Thu, Jan. 21, 12:19 PM
- BB&T (BBT -0.6%) is a rare regional lender in the red today following this morning's earnings miss. After backing out merger-related and restructuring charges, the company earned $0.68 per share, shy of consensus by a penny.
- Net interest margin for the quarter of 3.35% slipped one basis point from a year ago, while average earning assets and liabilities both jumped thanks to the Susquehanna and Bank of Kentucky purchases.
- Mortgage banking income fell 18.8% Y/Y to $104M, and investment banking income by 18.8% to $91M.
- NPLs as a percent of total loans fell to 0.42% from 0.51% a year ago.
- Previously: BB&T misses by $0.01, misses on revenue (Jan. 21)
- The CET 1 ratio of 10.2% compares to 10.1% in Q3.
Thu, Jan. 21, 5:46 AM
Wed, Jan. 20, 5:30 PM
Dec. 23, 2015, 6:41 PM
- The Fed, the FDIC, and "all required state banking regulators" have approved BB&T's (NYSE:BBT) planned $1.8B acquisition of mid-Atlantic bank National Penn Bancshares (NASDAQ:NPBC). The cash/stock deal, first announced in August, is expected to close in the next few months.
- National Penn has $9.6B in assets, $7B in deposits, and 124 branch offices. BB&T plans to make National Penn CEO Scott Fainor a group executive overseeing "multiple community banking regions in Pennsylvania and contiguous states."
- Three months ago: BB&T deal pause may not last long
Dec. 14, 2015, 3:32 PM
- The troubles in credit mean investors need to discount those costs against the benefits of higher rates, say David George and team at Baird. In other words, downside risk to 2016/2017 EPS estimates arises not just from net interest margin compression, but also higher loan costs.
- Three picks from the team: Bank of America (NYSE:BAC) at 1.1x tangible book value vs. peers at 1.35x. The $18 price target assumes just 1.05x book given weaker returns on capital and revenue growth visibility. BB&T (NYSE:BBT) trades at 11.5x 2016 estimated EPS - inline with peers, but BB&T's solid pre-provision returns, competitive positioning, and better relative capital deployment opportunities warrant a premium valuation. JPMorgan (NYSE:JPM) is also trading about inline with peers through it too has better relative returns and growth opportunities.
Nov. 9, 2015, 7:32 AM
- The BB&T (NYSE:BBT) brand comes to the mid-Atlantic after the weekend conversion of 239 recently-purchased Susquehanna branches in PA, MD, NJ, and WV.
- "Merger buddy" teams are available at all locations to provide conversion support, and former Susquehanna customers now have access to an expanded network of 2,150 branches and 3,300 ATMs.
Oct. 19, 2015, 3:02 PM
- BB&T (NYSE:BBT) declares $0.27/share quarterly dividend, in line with previous.
- Forward yield 2.98%
- Payable Dec. 1; for shareholders of record Nov. 13; ex-div Nov. 10.
Oct. 15, 2015, 2:49 PM
- The financial sector was pretty roughed-up during the August declines and hasn't really bounced a whole lot - in other words primed to rally on anything but the worst Q3 earnings results. Among those reporting today, Citigroup is up 4.7% and Goldman 3%. In regional banks, KeyCorp (KEY +4.8%), BB&T (BBT +2.9%), and U.S. Bancorp (USB +1%).
- The FInancial SPDR ETF (XLF +2.2%) is outperforming the S&P 500 by about 100 basis points on the session.
- The KBW Bank ETF (KBE +1.4%) and the KBW Regional Bank ETF (KRE +1.3%).
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, IAT, IAI, SEF, IYG, FXO, FNCL, KBWB, FINU, QABA, KBWR, KRU, RWW, RYF, FINZ, KRS, XLFS
Oct. 15, 2015, 7:14 AM
- Net income of $492M or $0.64 per share vs. $512M and $0.70 one year ago. Excluding merger-related and restructuring costs, net income of $539M gained 4.5% Y/Y, and adjusted EPS dipped a penny to $0.70.
- The Susquehanna purchase pushed BBT above $200B in assets.
- Fully phased-in CET 1 ratio of 9.8%.
- ROA of 1.04% slips 14 basis points Y/Y. ROE of 13.23% slips 160 basis points. NIM of 3.35% falls three basis points. Efficiency ratio of 59.2% deteriorates 50 basis points.
- Earnings call at 8 ET
- Previously: BB&T beats by $0.03, beats on revenue (Oct. 15)
- Shares flat premarket
Oct. 15, 2015, 5:48 AM
- BB&T (NYSE:BBT): Q3 EPS of $0.70 beats by $0.03.
- Revenue of $2.49B (+6.9% Y/Y) beats by $40M.
Oct. 14, 2015, 5:30 PM
Oct. 2, 2015, 11:33 AM
- The long-awaited regulatory approval of the M&T Bank's purchase of Hudson City Bancorp, and the relatively quick green light for BB&T's acquisition of Susquehanna Bancshares has lifted M&A animal spirits in the regional bank sector.
- Another possible buyer could be Regions Financial (NYSE:RF) - its done well on its annual stress tests, and has expressed a willingness to look into deals. There's also Memphis-based First Horizon National (NYSE:FHN), though at least one activist believes the bank is more target than hunter.
- Possible sellers include First Niagara Financial (NASDAQ:FNFG), which has already put itself on the block.
- A target for BBT or Regions might be Georgia's Synovus Financial (NYSE:SNV), with $27B in assets, and an activist investor pushing for a sale.
- Another target might be Astoria Financial (NYSE:AF), with $15.3B in assets, and a neighbor in New York Community Bancorp (NYSE:NYCB) which might be on the hunt for acquisitions.
Sep. 24, 2015, 1:29 PM
- Among the more acquisitive of U.S. banks, BB&T's (NYSE:BBT) recent purchase of National Penn Bancshares was its third in a year (it hasn't closed yet), and will take assets to roughly $220B. It was enough for CEO Kelly King to talk about a "pause" in deals during the bank's earnings call in July.
- At $250B in assets, banks are subject to a kicked-up notch of regulatory oversight.
- "As we approach $250B you wouldn’t likely see us slip over . . . to $251B," King tells the FT today. "We will have a strategy in place to meaningfully go over, to absorb the additional cost of that hurdle point."
- While others are cautious about bank M&A, King says the Fed will approve deals if the buyer shows it is operating under the highest standards.
- Scale matters, says King. "I’ve made it very clear we are trying to get larger in this particular timeframe. Not because we want to be bigger but because we need scale to afford investments in technology and regulatory compliance.”
Sep. 17, 2015, 2:37 PM
- It'll be at least a little while longer until banks and insurers get the higher rates they are hoping will boost sluggish profits, as the Fed holds its fire this month.
- The "dots" however are still projecting at least one rate hike before year-end.
- The SPDR KBW Regional Banking ETF (KRE -1.4%), and the SPDR KBW Bank ETF (KBE -1.2%).
- BofA (BAC -1.7%), Wells Fargo (WFC -1.2%), Regions (RF -2%), KeyCorp (KEY -1.8%), BB&T (BBT -1.7%), Fifth Third (FITB -2.4%), MetLife (MET -2.2%), Prudential Financial (PRU -1.9%), Schwab (SCHW -2.2%), Ameritrade (AMTD -2%), E*&Trade (ETFC -1.2%).
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, IAT, SEF, IYG, FXO, FNCL, KBWB, FINU, QABA, KRU, KBWR, RWW, RYF, PSCF, FINZ, KRS
BB&T Corporation is a financial holding company, which through its subsidiary, Branch Banking and Trust Company provides a range of banking services to individuals and businesses, and offers loans to businesses and consumers.
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