4. City Holding Company
Shares of City Holding Company (CHCO) of Cross Lanes, W.Va., closed at $32.11 last Friday, down 8% year-to-date. Based on a quarterly payout of 34 cents, the shares have a dividend yield of 4.24%.
The company's year-to-date ROA was 1.53% as of Sept. 30, and its five-year average ROA was 1.56%.City Holding Company had $2.7 billion in total assets as of Sept 30, with 68 branches in West Virginia, Kentucky and Ohio. The company on Nov. 14 agreed to acquire Virginia Savings Bancorp of Front Royal, for $13.4 million, bringing on roughly $130 million in assets, including five branches, in Northwestern Virginia. Third-quarter net earnings allocated to common shareholders were $11.5 million, or 76 cents a share, increasing from $9.8 million, or 64 cents a share, in the second quarter, and $9.0 million, or 58 cents a share in the third quarter of 2010. The biggest factor in the earnings improvement was a decline in credit costs. The company made no provision for loan loss reserves during the third quarter, compared to credit provisions of $1.3 million the previous quarter and $1.8 million a year earlier. Sterne Agee analyst Kenneth James on Oct. 26 lowered his rating on City Holding Company to "Underperform," or "Sell," from a neutral rating, while lowering his 2012 earnings estimate to $2.46 a share from $2.55, in part because of a heavy risk to earnings "from the revenue concentration (27%) in deposit service charges," which were heavily comprised of overdraft fees, and would "remain under pressure from changes in consumer behavior and potentially new regulations." James also cited the stock's "relatively high valuation" in justifying his downgrade. The shares trade for 12.4 times the consensus 2012 EPS estimate of $2.59, among analysts polled by FactSet, and 1.9 times tangible book value, according to SNL. Out of eight analysts covering City Holding Company, one rates the shares a buy, while the remaining analysts all have neutral ratings.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
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.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
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.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV