This Day On The Street
Continue to site right-arrow
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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

10 Big Banks With Solid Revenue

Stocks in this article: C BAC WFC JPM PBCT STT FNFG FRC WFSL HBHC SIVB SBNY WTFC ISBC HBC

10. Investors Bancorp

Shares of Investors Bancorp (ISBC) of Short Hills, N.J., closed at $13.98 Monday, returning 7% year-to-date.

Investors Bancorp is part of a mutual holding company structure, with roughly 42% of common shares outstanding and the mutual holding company (the depositors in main subsidiary Investors Savings Bank) holding the other 58%. Sterne Agee analyst Matthew Kelly said in a July 29 report that he expects Investors "will announce a second step conversion over the next year," through which the company would give up the mutual holding company structure, and that "fully converted tangible book value in current terms would be roughly $15.93 - $16.78 per share." Kelly estimates that Investors Bancorp's tangible book value was $8.01 per share as of June 30.

Kelly told TheStreet that the second-step conversion would likely lead to tremendous gains for the current common shareholders, since "roughly $1 billion in new capital" would be raised, with "no dilution for the common shareholders."

Second-quarter net income was $19.6 million, or 18 cents a share, increasing from $15.3 million, or 14 cents a share, in the second quarter of 2010. Running counter to the industry trend -- especially for a holding company with increased earnings -- the second-quarter provision for loan losses was $18.5 million, increasing from $15.5 million a year earlier.

According to SNL Financial, Investors Bancorp's pre-provision net revenue for the second quarter was $49.1 million, increasing 28% year-over-year. Net interest income was up 27% from a year earlier to $82.4 million in the second quarter. The second-quarter net interest margin -- the difference between the average yield on loans and investments and the average cost of funds -- for the second quarter was 3.46%, increasing from 3.10% a year earlier.

The operating return on average assets (ROA) for the second quarter was 0.79% according to SNL.

Total loans -- including those held for sale and in the portfolio -- grew 18% year-over-year to $8.6 billion as of June 30, as the company focused on adding more multifamily and commercial real estate loans.

Chief operating officer Domenick Cama told TheStreet that "the net interest margin expansion comes from the continued transformation" of the balance sheet toward loans, "and the steep yield curve." Cama added that in addition to the multifamily lending focus and growth in commercial real estate loans, Investors Bancorp is "looking to expand our commercial and industrial lending business. "

Following Investors Bancorp's second-quarter earnings announcement, Kelly reiterated his "Buy" rating for the shares, with a $16 price target, in a report entitled "Growth Train Keeps Rolling,"

The shares trade for 16.6 times the consensus 2012 earnings estimate of 84 cents a share, among analysts polled by FactSet.

Four of the seven analysts covering Investors Bancorp rate the shares a buy, while the remaining analysts all have neutral ratings.

2 of 11

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs