This Day On The Street
Continue to site
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

Analyst Touts Washington Federal Upside

SEATTLE ( TheStreet) -- Saying Washington Federal (WFSL) was "on track to drive improved profitability going forward as credit costs continue to decline," McAdams Wright Ragen analyst Sara Hasan reiterated Monday her buy rating for the shares, and $23 price target.

The target price would represent a 51% return for investors, based on Friday's closing stock price of $15.26.

After meeting with Washington Federal's CFO Brent Beardall, Hasan said that with the company having repaid the Troubled Assets Relief Program, or TARP, and with "credit costs falling, we think the future looks bright for WFSL and its robust capital balance." Adding that organic growth "remains challenging today," Hasan explained that acquisitions "are a likely option" for deploying excess capital, although Washington Federal's discipline on pricing "may limit its standing as an acquirer-of-choice."

Hasan estimate that the company had enough excess capital to support "an additional $2-3 billion in assets."

The company had $13.5 billion in total assets of September 30, and a tangible common equity ratio of 11.98%, which was the second-highest among the largest 50 U.S. bank and thrift holding companies, according to data from Securities and Exchange Commission filings supplied by SNL Financial.

For the third quarter, Washington Federal reported net income of $16 million, or 14 cents a share, improving from $9.6 million, or 11 cents a share a year earlier. For the company's fiscal 2010 ended September 30, net income was $118.7 million, or $1.05 a share, compared to $40.7 million, or 46 cents a share, for fiscal 2009. Earnings for the full fiscal year were boosted by a $54.8 million after-tax gain on the bargain purchase of the failed Horizon Bank of Bellingham, Wash. from the Federal Deposit Insurance Corp. in January.

The company's annualized ratio of net charge-offs - loan losses less recoveries - to average loans for the third quarter was 1.69%, which was low compared to the national aggregate third-quarter net charge-off ratio of 2.32% reported by the FDIC. Washington Federal's third-quarter provision for loan loss reserves was $26 million, increasing from $20.7 million in the second quarter but declining from $42.6 million in the third quarter of 2009.
1 of 3

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
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
HCBK $0.00 0.00%
BAC $14.55 -1.60%
C $46.28 -0.96%
JPM $63.21 -0.61%
AAPL $93.75 -1.10%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs