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10 New York Bank Stocks With Most Upside for 2012

Stocks in this article: C JPM MS MET BK GS FNFG NYB DCOM FFIC MBI HBC

9. New York Community Bancorp

Shares of New York Community Bancorp (NYB) of Westbury closed at $11.97 Friday, declining 32% year-to-date. Based on a quarterly payout of 25 cents, the shares have a dividend yield of 8.35%. This is the highest dividend yield among actively traded banks (excluding those listed on the Pink Sheets) with average daily trading volume of at least 50,000 shares, according to data provided by SNL Financial.

A consensus price target of $14.24 implies 19% upside for the shares.

New York Community Bancorp has maintained the 25-cent quarterly dividend payout for 31 consecutive quarters, however, some of the pressure on the shares this year has resulted from a high dividend payout ratio, with the company paying out over 90% of operating earnings over the past two quarters.

Investors will be looking for increased revenue from the company's mortgage business -- acquired when New York Community purchased the failed AmTrust Bank of Cleveland from the Federal Deposit Insurance Corp. in December 2009 -- to boost earnings in 2012.

Guggenheim Securities analyst David Darst in October reiterated his "Buy" rating for New York Community, after the company reported its third-quarter results, saying that "the dividend is secure and is a key component of investor return," and that he expected the lender to "grow core earnings over the next two years by deploying liquidity into loans with improving market conditions for core loan growth." Darst's price target for the shares is $15.00, and he expects the company to earn $1.09 a share in 2012.

The shares trade for 10.9 times the consensus 2012 EPS estimate of $1.10, among analysts polled by FactSet, and for 1.7 times tangible book value, according to SNL.

Out of 18 analysts covering New York Community Bancorp, eight rate the shares a buy, nine have neutral ratings, and one analyst recommends selling the shares.

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

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