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10 Midwest Bank Stocks Finally Paying Off

8. FirstMerit

Shares of FirstMerit (FMER) of Akron, Ohio, closed at $17.21 Friday returning 15% year-to-date, following a 20% decline during 2011.

Based on a 16-cent quarterly payout, the shares have a dividend yield of 3.72%.

FirstMerit earned $119.6 million, or $1.10 a share during 2011, increasing from $102.9 million, or $1.02 a share, during 2010.

At the KBW Boston Bank Conference on Feb. 29, FirstMerit CEO Paul Greig said that the company had "earned money 51 consecutive quarters, with "returns on average assets and equity are strong versus our peers."

The 2011 ROA was 0.82%, putting the company in the middle of this group of 10 Midwest bank holding companies.

KBW analyst Christopher McGratty rates FirstMerit "Market Perform," with a $14 price target, saying on March 2 that he company remained "well-positioned to pursue attractive M&A opportunities in the Chicagoland market, and we anticipate the company will remain a disciplined and selective buyer."

McGratty estimates that FirstMerit will earn $1.15 a share during 2012, followed by EPS of $1.25 in 2013.

The shares trade for 1.7 times tangible book value, and for 15 times the consensus 2012 EPS estimate of $1.13. The consensus 2013 EPS estimate is $1.21.

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

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