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Wall Street is into week number two of the first quarter earnings season. That means more banks, especially the big regional banks, will be reporting. After last year’s banking crisis shook the industry, the banks are looking to return to stability in 2024.
Meanwhile, the banks are still hated on Wall Street. Bank analysts look to the price-to-book ratio (P/B) to determine a bank’s “cheapness” and not the price-to-earnings (P/E) ratio.
What is a “Cheap” Bank?
Look for banks that have a low P/B ratio. That means investors should buy banks with P/B ratios near 1.0. A bank with a P/B ratio of 2.0 is considered expensive. All five of these regional banks featured this week have dirt cheap price-to-book ratios under 1.4.
These 5 banks also sport solid earnings surprise track records over the last 5 years. That’s not an easy feat given the recent economic conditions which included a pandemic, followed by the Fed raising rates at the quickest pace in decades.
Will the regional banks post another earnings surprise in the first quarter?
5 Key Bank Earnings Charts to Watch
1. The PNC Financial Services Group, Inc. (PNC - Free Report)
PNC Financial is a regional bank headquartered in Pittsburgh with a market cap of $59 billion. It has beat on earnings 4 quarters in a row and has just 2 misses over the last 5 years.
Shares of PNC Financial are down 3.1% year-to-date. It pays a dividend, currently yielding 4.1%.
U.S. Bancorp is a regional bank headquartered in Minneapolis. It has a market cap of $64 billion. U.S. Bancorp has beat 3 out of the last 4 quarters. It also has a great 5-year track record of just 2 misses.
Shares of U.S. Bancorp are down 4.2% year-to-date. It pays a dividend currently yielding 4.7%.
Wintrust Financial is a regional bank headquartered in Chicago with a market cap of $5.9 billion. Wintrust is coming off an earnings miss last quarter but beat 3 consecutive quarters prior to that miss.
Shares of Wintrust are up 3.5% on the year. It pays a dividend, currently yielding 1.9%.
Should investors look at smaller regional banks like Wintrust?
Bank OZK is a regional bank headquartered in Little Rock, Arkansas known for its lending in the real estate industry. It has a market cap of $4.7 billion. Bank OZK has beat on earnings two quarters in a row.
However, shares of Bank OZK have taken a dive in 2024, falling 15.4% year-to-date. It recently raised its dividend, which now yields 3.7%.
Comerica is a regional bank headquartered in Dallas. It has a market cap of $6.7 billion. Although headquartered in Texas, it also has a big presence in Michigan.
Comerica has a great earnings surprise track record having beaten 7 quarters in a row. It has only missed twice in the last 5 years.
Shares of Comerica have struggled this year. It’s down 9.9% year-to-date. However, investors are rewarded with a dividend for their patience. Comerica is currently yielding 5.5%.
Is this a buying opportunity in Comerica?
[In full disclosure, Tracey owns shares of OZK in Zacks Value Investor portfolio and her own personal portfolio.]
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5 Key Regional Bank Earnings Charts to Watch
Wall Street is into week number two of the first quarter earnings season. That means more banks, especially the big regional banks, will be reporting. After last year’s banking crisis shook the industry, the banks are looking to return to stability in 2024.
Meanwhile, the banks are still hated on Wall Street. Bank analysts look to the price-to-book ratio (P/B) to determine a bank’s “cheapness” and not the price-to-earnings (P/E) ratio.
What is a “Cheap” Bank?
Look for banks that have a low P/B ratio. That means investors should buy banks with P/B ratios near 1.0. A bank with a P/B ratio of 2.0 is considered expensive. All five of these regional banks featured this week have dirt cheap price-to-book ratios under 1.4.
These 5 banks also sport solid earnings surprise track records over the last 5 years. That’s not an easy feat given the recent economic conditions which included a pandemic, followed by the Fed raising rates at the quickest pace in decades.
Will the regional banks post another earnings surprise in the first quarter?
5 Key Bank Earnings Charts to Watch
1. The PNC Financial Services Group, Inc. (PNC - Free Report)
PNC Financial is a regional bank headquartered in Pittsburgh with a market cap of $59 billion. It has beat on earnings 4 quarters in a row and has just 2 misses over the last 5 years.
Shares of PNC Financial are down 3.1% year-to-date. It pays a dividend, currently yielding 4.1%.
Is this a buying opportunity in PNC Financial?
2. U.S. Bancorp (USB - Free Report)
U.S. Bancorp is a regional bank headquartered in Minneapolis. It has a market cap of $64 billion. U.S. Bancorp has beat 3 out of the last 4 quarters. It also has a great 5-year track record of just 2 misses.
Shares of U.S. Bancorp are down 4.2% year-to-date. It pays a dividend currently yielding 4.7%.
Should U.S. Bancorp be on your watch list?
3. Wintrust Financial Corp. (WTFC - Free Report)
Wintrust Financial is a regional bank headquartered in Chicago with a market cap of $5.9 billion. Wintrust is coming off an earnings miss last quarter but beat 3 consecutive quarters prior to that miss.
Shares of Wintrust are up 3.5% on the year. It pays a dividend, currently yielding 1.9%.
Should investors look at smaller regional banks like Wintrust?
4. Bank OZK (OZK - Free Report)
Bank OZK is a regional bank headquartered in Little Rock, Arkansas known for its lending in the real estate industry. It has a market cap of $4.7 billion. Bank OZK has beat on earnings two quarters in a row.
However, shares of Bank OZK have taken a dive in 2024, falling 15.4% year-to-date. It recently raised its dividend, which now yields 3.7%.
Is Bank OZK on sale?
5. Comerica Inc. (CMA - Free Report)
Comerica is a regional bank headquartered in Dallas. It has a market cap of $6.7 billion. Although headquartered in Texas, it also has a big presence in Michigan.
Comerica has a great earnings surprise track record having beaten 7 quarters in a row. It has only missed twice in the last 5 years.
Shares of Comerica have struggled this year. It’s down 9.9% year-to-date. However, investors are rewarded with a dividend for their patience. Comerica is currently yielding 5.5%.
Is this a buying opportunity in Comerica?
[In full disclosure, Tracey owns shares of OZK in Zacks Value Investor portfolio and her own personal portfolio.]