Home Bancshares (HOMB) of Conway, Ark., closed at $34.35 Friday, returning 34% year-to-date, following a 19% return last year.
The shares trade for 2.4 times tangible book value, and for 15 times the consensus 2013 EPS estimate of $2.34. The consensus 2012 EPS estimate is $2.20.
With a quarterly payout of 10 cents, the shares have a dividend yield of 1.16%.For the 12-month period ended June 30, the company's ROA was 1.48%, while its ROE was 12.13%, according to Thomson Reuters Bank insight. The company had $4.1 billion in total assets as of June 30, and has expanded rapidly through several opportunistic acquisitions over the past few years, including the $27.9 million purchase in February of Vision Bank of Panama City, Fla., from Park National Corp. (PRK) of Newark, Ohio. Please see TheStreet's Q&A with Home Bancshares founder and Chairman John W. Allison for more on the company's strategy. Home Bancshares on Aug. 15 announced a deal to acquire Premier Bank of Tallahassee, Fla., for $1.4 million, in connection with a bankruptcy filing by the target bank's parent, Premier Bank Holding Company. Premier Bank had $282 million in assets as of June 30, with six branches. KBW analyst Derek Hewitt said on Aug. 15 that "HOMB is the stalking horse and there could be other bidders once the bankruptcy process begins," but that "HOMB could receive up to $550k if Premier Bank is acquired by another bidder." The analyst has a neutral rating on Home Bancshares, with a $32 price target, and said that if the deal were completed, as expected, by the end of this year, it would leverage "a small portion of excess capital" for the acquirer. Premier Bank was undercapitalized as of June 30, with a Tier 1 leverage ratio of just 3.43%, and its nonperforming assets -- including loans past due 90 days or more, or in nonaccrual status, plus repossessed real estate -- made up 12.29% of total assets, according to Thomson Reuters Bank Insight. According to Hewitt, "HOMB could have been outbid by other institutions in a worst case receivership scenario," if Premier Bank were to fail and be auctioned by the Federal Deposit Insurance Corp. The analyst said that "Premier Bank fits nicely into HOMB's existing FL panhandle footprint and there is the potential for substantial cost savings," adding that the target bank "has a valuable deposit franchise as lower-cost transaction accounts represent about two-thirds of deposits." HOMB data by YCharts
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