This Day On The Street
Continue to site
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

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

3. Pinnacle Financial Partners

Shares of Pinnacle Financial Partners of Nashville, Tenn., closed at $18.31 Monday, returning 13% year-to-date, following a 19% return during 2011.

The shares trade for 1.5 times their reported Sept. 30 tangible book value of $12.19, and for 14 times the consensus 2013 EPS estimate of $1.32.

Pinnacle Financial Partners had $4.9 billion in total assets as of Sept. 30. The company reported third-quarter net income available to common shareholders of $11.3 million, or 33 cents a share, increasing from $7.8 million, or 23 cents a share, the previous quarter, but declining from $24.5 million, or 72 cents, in the third quarter of 2011, when Pinnacle recaptured its entire $22.5 valuation allowance for deferred tax assets.

Pinnacle reported third-quarter net interest income of $40.9 million, increasing from $40.2 million the previous quarter, and $38.4 million a year earlier. CEO Terry Turner said that the company "continued the meaningful expansion of the core earnings capacity of the firm during the third quarter, increasing loans at a linked-quarter annualized growth rate of 9.4 percent and increasing our net interest margin for the eighth consecutive quarter." The net interest margin expanded to 3.78% in the third quarter, from 3.76% the previous quarter and 3.60% a year earlier.

Martin rates Pinnacle Financial Partners "Market-Perform," with a price target of $21, saying on Oct. 19 after the company reported its third-quarter results that "PNFP delivered a solid quarter posting core profits of $0.33 per share underscored by continued loan growth, modest NIM expansion, good expense controls and improvement in credit."

The analyst explained Pinnacle's margin improvement: "Loans increased $80 million, or nearly 10% annualized with C&I plus owner occupied CRE accounting for $53 million, or 65% of the growth. Growth continues to be funded by the investment portfolio which is down ~$190 million YTD. Deposits increased modestly with good mix improvements noted."

Martin said that "we are encouraged by recent trends and future prospects as PNFP transitions back to an offensive growth story; however, believe current valuation levels at 15x our 2013 EPS and ~150% of projected tangible book value support this rating."

The analyst estimates that Pinnacle will earn $1.34 a share in 2013.

PNFP Chart PNFP data by YCharts

Interested in more on Pinnacle Financial Partners? See TheStreet Ratings' report card for this stock.

9 of 11

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
Only $9.95
14-Days Free
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!
BBT $37.78 0.00%
HBHC $28.93 0.00%
OZRK $39.42 0.00%
PB $52.17 0.00%
PNFP $47.04 0.00%


DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs