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

10 Community Bank M&A Targets

6. Pinnacle Financial Partners

Shares of Pinnacle Financial Partners (PNFP - Get Report) of Nashville, Tenn. closed at $15.56 Friday, up 11% from a year earlier.

The company had $4.8 billion in total assets as of March 31 and owes $95 million in TARP money.

Matt Olney said in January that Pinnacle could have "a takeout price in excess of $16 because of its attractive Tennessee footprint." The shares are up 15% year-to-date.

In a report following the company's first-quarter earnings announcement, Sterne Agee analyst Peyton Greene said some of the recent rise in Pinnacle's shares reflected M&A speculation, and that the company's "penetration and concentration in the Nashville MSA make it an obvious target for would-be acquirers looking to deepen or extend their footprint into one of the most attractive and business friendly markets in the Southeast." The "the three superregional and money center banks that dominate the market" and could be potential bidders for Pinnacle Financial include Bank of America (BAC - Get Report), SunTrust (STI) and Regions Financial (RF).

Pinnacle reported first-quarter net income available to common shareholders of $2 million, or 6 cents a share, compared to a loss of $5.4 million, or 16 cents a share, in the first quarter of 2010. As would be expected at this point in the credit cycle, the earnings improvement sprang from a reduction in the provision for loan losses to $6.1 million from $13.3 million a year earlier.

Nonperforming assets totaled $132.4 million, or 2.75% of total assets as of March 31, improving from 3.18% a year earlier. The first-quarter net charge-off ratio was 1.22%, while reserves covered 2.46% of total loans as of March 31.

Following the earnings announcement, FIG Partners analyst Christopher Marinac lowered his rating on Pinnacle Financial to a neutral rating of "market perform," saying that although the company's favorable credit and revenue trends was "sustainable," its valuation was a bit high when compared to his firm's normalized earnings estimate $1.02 a share.

The shares trade for 21 times the consensus 2012 earnings estimate of 76 cents, and 1.6 times tangible book value, according to SNL.

Out of 13 analysts covering Pinnacle Financial, two rate the shares a buy, 10 have neutral ratings and the remaining analyst recommends selling the shares.
6 of 11

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
BPFH $9.70 -2.12%
BAC $11.16 -6.84%
BXS $18.96 -2.87%
FMBI $15.90 -2.33%
JPM $53.07 -4.41%


Chart of I:DJI
DOW 15,660.18 -254.56 -1.60%
S&P 500 1,829.08 -22.78 -1.23%
NASDAQ 4,266.8370 -16.7550 -0.39%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs