10 Bank Stocks From the South for Smart Long-Term Investors

1. Hancock Holding Company

Shares of Hancock Holding Company (HBHC) of Gulfport, Miss, closed at $30.84 Monday, down 1% year-to-date, following a 5% decline during 2011.

The shares trade for 1.6 times their reported Sept. 30 tangible book value of $18.97, and for 12 times the consensus 2013 EPS estimate of $2.62. Based on a quarterly payout of 24 cents, the shares have a dividend yield of 3.11%.

Hancock Holding Company had $18.5 billion in total assets as of Sept. 30. The company reported third-quarter net income of $47.0 million, or 55 cents a share, increasing from $39.3 million, or 46 cents a share, in the second quarter, and $30.4 million, or 36 cents a share, in the third quarter of 2011. The main factor in the earnings improvement was the lack of merger expenses in the third quarter, compared to merger-related expenses of $11.9 million the previous quarter, and $22.8 million a year earlier

The third-quarter net interest margin was a tax-adjusted 4.54%, expanding from 4.48% the previous quarter, and 4.32% a year earlier. The company reported a third-quarter operating ROA of 1.07% and an operating return on average common equity of 8.24%.

Marinac rates Hancock Holding company "Outperform," with a price target of $37.25, although on Nov. 9 he lowered his 2013 earnings estimate for the company to $2.75 from $3.00, "on our perception that balance sheet growth will be slower than we previously projected."

Marinac said that the company "should still earn strong ROA-Return On Assets above 1.20% in 2013 and turn in 13.5% ROTCE-Return on Tangible Common Equity which support a solid P/E and Price-to-Tang. Book valuation. Moreover, our EPS reduction is a function of lower earning assets and not an issue with NIM-Net Interest Margin or overhead costs."

HBHC data by YCharts

Interested in more on Hancock Holding Company? See TheStreet Ratings' report card for this stock.

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

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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 TheStreet.com 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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