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10 Buy Rated Regional Bank Stocks (Update 3)

6. Lakeland Financial

Shares of Lakeland Financial (LKFN) of Warsaw, Ind., on Monday closed at $26.94, rising 5% year-to-date, with a five-year total return of 26%. Based on a quarterly payout of 15.5 cents, the shares have a dividend yield of 2.30%.

The stock is rated an "A" by TheStreet Ratings.

The company had $2.9 billion in total assets as of Dec. 31, with 47 branches.

Lakeland Financial on Wednesday reported fourth-quarter earnings of $8.3 million, or 51 cents a share, declining slightly from $8.4 million, or 52 cents a share, in the third quarter, but increasing from $5.8 million, or 36 cents a share, in the fourth quarter of 2010.

Total loans grew 2% during the fourth quarter and 6% year-over-year, to $2.2 billion as of Dec 31. CFO David Findlay said that total loans had grown by $880 million or 65% over the past five years, and that the growth was not "the result of acquisition or entry into new markets," but had "resulted from targeted growth in our core Indiana markets by great client relationship teams."

Noninterest-bearing deposits were up 10% sequentially and 17% year-over-year, to $357 million as of Dec. 31. Still, the net interest margin -- the difference between a bank's average yield on loans and investments and its average cost for deposits and wholesale borrowings -- narrowed to 3.38% in the fourth quarter, from 3.48% the previous quarter and 3.62% a year earlier, "primarily from reduced yields in the investment portfolio and slightly lower commercial loan yields as interest rates continue to be at historic lows."

Lakeland's fourth-quarter ROA was 1.13%, and the ROA has ranged between 0.93% and 1.20% over the past five quarters, according to the company.

The shares trade for 1.6 times tangible book value, according to SNL Financial, and for 13 times the consensus 2012 EPS estimate of $1.60, among analysts polled by FactSet.

Interested in more on Lakeland Financial? See TheStreet Ratings' report card for this stock.

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