This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

5 Stocks That Could Be Trampled

 

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

3. BankUnited (BKU - Get Report)  

After being seized by the Federal Deposit Insurance Corporation in May 2009 on concerns over the Florida-based lender's solvency, BankUnited was acquired by a consortium of private equity funds and longtime bank investors including the Blackstone Group, the Carlyle Group, Centerbridge Partners, Wilbur Ross and John Kanas. The investor group took control of a bank with $12.7 billion in assets and $8.3 billion in deposits and agreed to give the struggling institution $900 million in capital and share on potential losses with the FDIC.  

After toying with an IPO for months, BankUnited went ahead with a share offering in January 2011, selling shares for $29 to raise $783 million in a sale that was reported to have tripled the consortium's initial investment.  

Since the offering BankUnited shares have slumped nearly 15%, underperforming the KBW Bank Index's (KBE) near 7% drop. While the BankUnited's been able to show strong loan and deposit growth compared with some super-regional competitors, the bank saw its 2011 profit fall by roughly two-thirds.  

After a FDIC disclosure mandate threatened to force unwanted disclosures by the bank's private equity owners, BankUnited confirmed in 2012 that it had been exploring a sale, with speculation that BB&T (BBT) or Toronto-Dominion (TD) as potential acquirers. Instead, the company said that a sale process had "concluded," with the company looking to remain independent. In February BankUnited boosted its quarterly dividend by 21% to 14 cents a share.

"Given their pessimistic view of M&A and the failed attempt to sell the bank in January, it comes to no surprise that BKU increased its quarterly dividend," noted KBW analyst Brady Gailey in a Feb. 29 note. He rates shares "market perform" with a price target of $24.  

Overall, BankUnited has a price target of $25.80 a share according to analysts polled by Bloomberg who give shares five "buy" ratings and four "holds."  

The bank's five largest shareholders are private equity funds that hold an over 50% stake in the Miami Lakes, Fla- based lender. Wilbur Ross-run WL Ross & Co. and the Carlyle Group each hold 13.87% stakes in BankUnited shares, according to Bloomberg data. For more on BankUnited shares, see banks ready to sell out.

4 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
BKU $32.75 -0.88%
DNKN $47.58 -0.04%
HCA $75.23 -1.20%
KOS $7.92 -0.38%
KMI $42.06 -0.02%

Markets

DOW 17,776.12 -200.19 -1.11%
S&P 500 2,067.89 -18.35 -0.88%
NASDAQ 4,900.8850 -46.5560 -0.94%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs