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
TheStreet Open House

U.S Bancorp: Analyst Upgrade Winner

NEW YORK ( TheStreet) -- U.S. Bancorp (USB) was the winner among the largest U.S. financial firms Monday, with the stock rising over 1% to close at $34.09.

The broad indices ended with slight declines, as investors seemed to digest the continuing market rally, and looked ahead to political events. The next major deadline for partisan bickering over spending in Washington is March 1, when the federal government will be required by law to make $85 billion in budget cuts, unless there is further action from Congress.

The budget cuts, known as "sequestration," were set up as part of the budget compromise between President Obama and Republican leaders in Congress in 2011, which led to the "fiscal cliff" debate that had investors at the edge of their seats toward the end of last year. This time around, a settlement seems unlikely.

Investors are also looking once again to Europe, with finance ministers in Brussels meeting on Monday and Tuesday to discuss a possible aid package for Cyprus. The officials are also discussing proposals for other bailouts by the European Stability Mechanism.

The KBW Bank Index (I:BKX) rose slightly to close at 55.13.

Migrating to Quality


U.S. Bancorp's shares have returned 7% this year, following a 21% return during 2011. The shares trade for 2.5 times tangible book value, according to Thomson Reuters Bank Insight. That is the highest price-to-tangible-book ratio among the 24 components of the KBW Bank Index. However, the shares trade for 10.3 times the consensus 2014 earnings estimate of $3.30 a share, which is a relatively low forward P/E ratio for a bank with such strong and consistent earnings.

As discussed in TheStreet's 5 Bank Stocks That Can't Stop Posting Profits, the company was among only 34 actively traded banks to post positive returns on equity every quarter from the beginning of 2006 through the third quarter of last year, according to data supplied by Thomson Reuters Bank Insight.

U.S. Bancorp has stood out among the largest U.S. bank holding companies, with a solid return on average assets (ROA) of 1.62% during 2012, and over the past 10 years, the ROA only slipped below 1% in 2009, when it was 0.82%, and the ROA was above 1.5% each year except for 2009 and for 2010, when it was 1.16%.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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