3. Astoria Financial
of Lake Success, N.Y., closed at $8.72 Friday, returning 4% year-to-date, after a decline of 36% in 2011.
Based on a quarterly payout of 13, the shares have a dividend yield of 5.96%.
The shares trade for just 0.8 times tangible book value, but 26 times the consensus 2012 EPS estimate of 53 cents. The consensus 2013 EPS estimate is 65 cents.
Astoria had $17 billion in total assets as of Dec. 30, and was the weakest earnings performer during 2011, among this group of 10 profitable holding companies, with ROA ranging from 0.28% to 0.39%. The company's fourth-quarter net interest margin was 2.20%, narrowing from 2.32% a year earlier.
Janney Capital Markets analyst Rick Weiss on Feb. 14 reiterated his "Buy" rating on Astoria, with a $10 fair value estimate, saying that "Astoria's stock price heavily discounts the company's intrinsic value, which is derived from its very attractive market area." Weiss added that the company's "better asset quality and okay capital levels should be adequate to support the dividend" until earnings improve.
Weiss said "the dividend payout ratio will be quite high for the foreseeable future, but even aggressive banking regulators are not apt to ignore supervisory guidelines and force a dividend cut as long as the economy does not seriously worsen." The analyst also said his recommendation and price target for Astoria reflect "Astoria's attractive dividend and takeover appeal."
Interested in more on Astoria Financial? See TheStreet Ratings' report card for this stock.