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10 Bank Stocks in the M&A Crosshairs (Update 2)

5. Guaranty Bancorp

Shares of Guaranty Bancorp (GBNK) of Denver closed at $1.75 Friday, returning 24% over the previous year.

The company was originally mentioned as a takeout candidate by FBR analyst Brett Scheiner in early 2011. Scheiner now says that "the company continues to improve operating results, though an impressive return on equity seems allusive." On the likelihood of a near-term takeout, the analyst says "it would seem in the next six months they can create more value by continuing operations of the bank."

Guaranty reported a 2011 loss to common shareholders of $13.4 million, or 21 cents a share, narrowing from a loss of $37.0 million, or 72 cents a share, in 2010, with the provision for loan losses declining to $5 million in 2010 from $34.4 million, a year earlier.

Fourth-quarter earnings to common shareholders were $2.3 million, or two cents a shares, compared to a loss of $22.6 million, or 44 cents a share, in the fourth quarter of 2010.

The shares trade for 1.1 times tangible book value, according to HighlineFI, and for 28 times the consensus 2012 EPS estimate of six cents.

Roth Capital Partners analyst Dave King has a neutral rating on Guaranty Bancorp, with a price target of $1.75, saying on Feb. 6 that the company's fourth quarter "exceeded expectations on a stronger margin and a resumption in loan growth," with the net interest margin increasing by "24 basis points sequentially to 3.86% after last quarter's early repayment of $51.0M in Federal Home Loan Bank borrowings and due to the continued runoff of brokered time deposits."

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

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