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10 Bank Stocks Bringing Home the Bacon (Mmm... Bacon)

1. Bank of the Ozarks

Shares Bank of the Ozarks (OZRK) of Little Rock, Ark., closed at $26.66 last Friday, returning 25% year-to-date. Based on a quarterly payout of 10 cents, the shares have a dividend yield of 1.50%.

The company's year-to-date ROA was 3.01% as of Sept. 30, and its five-year average ROA was 1.70%. This year's strong earnings performance reflects "gains recognized on a total of three government-assisted acquisitions," of failed institutions prior to 2011 that boosted earnings for the first three quarters of 2011 by $36.6 million, or $1.06 a share, "net of acquisition and conversion costs."

Bank of the Ozarks had $3.9 billion in total assets as of Sept. 30, with 112 branches, mainly in Arkansas, but also in Texas, Georgia, Florida North Carolina, South Carolina and Alabama.

Third-quarter net income available to common shareholders was $18.9 million, or 55 cents a share, compared to earnings of $50.2 million, or $1.46 a share in the second quarter, when the company booked $62.8 million in gains from Federal Deposit Insurance Corp. acquisitions, partially offset by an additional $20.2 million in income tax provisions. In the third quarter of 2010, Bank of the Ozarks earned $20.2 million, or 59 cents a share.

FIG Partners analyst Brian Martin has a neutral rating of "Market Perform" on Bank of the Ozarks, with a price target of $27.25, saying after the bank reported its third-quarter results, that although "management remains optimistic more deals are on the horizon and that covered (by FDIC loss-sharing) loans will continue to be the key driver of balance sheet growth in 2012 and possibly 2013," the gravy train will eventually stop running, and "OZRK must rely on organic growth to maintain record earnings."

The shares trade for 14.3 times the consensus 2012 earnings EPS of $1.86, among analysts polled by FactSet, and 2.4 times tangible book value, according to SNL.

Out of nine analysts covering Bank of the Ozarks, two rate the shares a buy, while the remaining analysts all have neutral ratings.

>>To see these stocks in action, visit the 10 Bank Stocks Bringing Home the Bacon portfolio on Stockpickr.

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

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

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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 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.
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