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5 Long-Term Bank Stock Picks From Jefferies (Update 1)

1. Western Alliance BanCorp
Shares of Western Alliance Bancorp (WAL) of Phoenix closed at $8.47 Friday, returning 36% year-to-date, following a 15% decline during 2011.

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The shares trade for 11 times the consensus 2013 EPS estimate of 77 cents.

Jefferies analyst Casey Haire on Monday raised his price target for the shares to $10.50 from $9.50, while leaving his 2012 EPS estimate of 60 cents and his 2013 estimate of 90 cents unchanged.

Western alliance will report its first-quarter results on April 19, with a consensus EPS estimate of 12 cents, compared to fourth-quarter earnings of seven cents a share, and EPS of three cents, during the first quarter of 2011.

Haire said that estimates the company will post first-quarter EPS of 13 cents and said on Monday that the "biggest wildcard" will be the write-down the company's repossessed real estate, "which should be meaningfully lower Q-Q (our model has $2.5mm vs. $8mm in 4Q) given that only 33% (vs. 66% in 4Q) of [the repossessed real estate] is up for reappraisal."

The analyst added that "WAL's nine quarter winning streak of revenue growth should continue despite a slower pace of loan growth (vs. 4Q) and [net interest margin] contraction, as the bank continues to take share against a weak competitive landscape."

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

>>To see these stocks in action, visit the 5 Long-Term Bank Stock Picks From Jefferies portfolio on Stockpickr.

-- Written by Philip van Doorn in Jupiter, Fla.

To contact the writer, click here: Philip van Doorn.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.
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