This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

New York Community Bancorp: How to Play It

Another bright spot for New York Community is continued high efficiency. A bank's efficiency ratio is essentially its noninterest expense divided by its interest and noninterest income, and New York Community's third-quarter efficiency ratio of 35.82% was third-best among the largest 50 U.S. bank and thrift holding companies, according to SNL Financial. It followed Hudson City Bancorp (HCBK - Get Report) with an efficiency ratio of 22.55% and Washington Federal (WFSL), at 32.19%.

New York Community Bancorp didn't take government bailout assistance from through the Troubled Assets Relief Program, or TARP. The company's tangible common equity ratio as of September 30 was 7.59%, rising from 6.03% a year earlier, despite the dividend payout.

Following the company's third-quarter earnings release, David Darst of Guggenheim Securities reiterated his buy rating on the shares and $19 price target, citing the bank's "improving fee income growth." His earnings estimate for 2011 is $1.40 a share, which is a forward price-to-earnings ratio of 12.1 based on Friday's close.

So how do you play New York Community Bancorp? The shares aren't particularly cheap, but one way to play it is to begin with a reasonable position and genuine long term commitment - meaning several years - while enjoying the near-6% yield and building the position on the inevitable market dips.

RELATED STORIES:




-- Written by Philip van Doorn in Jupiter, Fla.

To contact the writer, click here: Philip van Doorn.

To follow the writer on Twitter, go to http://twitter.com/PhilipvanDoorn.

To submit a news tip, send an email to: tips@thestreet.com.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
HCBK $9.47 2.05%
AAPL $128.70 -0.19%
FB $78.81 -0.23%
GOOG $540.78 0.54%
TSLA $230.51 1.98%

Markets

DOW 18,070.40 +46.34 0.26%
S&P 500 2,114.49 +6.20 0.29%
NASDAQ 5,016.9290 +11.5380 0.23%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs