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
TheStreet Open House

10 Bank Stocks With Up to 154% Upside for 2012

Stocks in this article: BACCJPMBKBPOPZIONFCFTFSLPSTBMETRWBCO

4. Metro Bancorp

Shares of Metro Bancorp (METR) of Harrisburg, Pa., closed at $8.69 Friday, down 21% year-to-date. Based on the mean price target of $12.33 among analysts polled by FactSet, the shares have 42% upside.

The company's main subsidiary Metro Bank is operating under an April 2010 consent order, agreeing with state regulators and the FDIC "to correct and prevent certain unsafe or unsound banking practices," and to analyze Bank Secrecy Act and Office of Foreign Assets Control staffing needs, as well as "qualifications and an analysis and assessment of the independence and performance of the Bank's directors and senior executive officers,"

The company reported a third-quarter net loss of $5.7 million, or 41 cents a share, compared to earnings of $2 million, or 14 cents in the second quarter, and a net loss of $6.2 million, or 46 cents, in the third quarter of 2010.

During the third quarter, Metro Bancorp recorded a $13.8 million provision for loan losses, after setting aside just $1.7 million for reserves the previous quarter. A year earlier, the provision totaled $13.4 million.

The company's annualized ratio of net charge-offs (loan losses less recoveries) to average loans during the third quarter was a high 3.34%, with loan losses rising "as a result of updated appraisals of collateral and financial information during the period associated with seven loan relationships," all of which were "originated in the years 2004 through 2008," according to CEO Gary Nalbandian.

While the company's nonperforming assets "trended lower for the fifth consecutive quarter to $45.5 million, or 1.87%, of total assets at September 30, 2011 from a high of $70.6 million, or 3.22%, or total assets at June 30, 2010," according to Nalbandian, a relatively low 1.61% ratio of loan loss reserves to total loans could point to additional quarterly losses if the bank is surprised again by declining collateral values.

The shares trade for 0.6 times tangible book value, according to SNL Financial, and 15.9 times the consensus 2012 EPS estimate of 52 cents.

All three analyst covering Metro Bancorp rate the shares a buy.

Metro Bancorp is a book value play, until its asset quality settles down, and it moves past the FDIC consent order.

Interested in more on Metro Bancorp? See TheStreet Ratings' report card for this stock.

8 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!
DOW 16,614.81 +215.14 1.31%
S&P 500 1,941.28 +37.27 1.96%
NASDAQ 4,419.4780 +103.4040 2.40%

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