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BB&T: Financial Winner

The bank saw sequential reductions in personnel expenses, with a slight reduction in headcount, and significant declines in loan related expenses and costs to maintain foreclosed properties.

A highlight for BB&T in the first quarter was a decline in total noninterest expenses to $1.414 billion from $1.488 billion in the fourth quarter, although expenses were up from $1.385 billion in the first quarter of 2012.

FBR analyst Paul Miller rates BB&T "market perform," with a price target of $33, and said in a note to clients on April 19 that "overall, this was a mixed quarter for BB&T as operating revenues declined, NIM continues to contract, and loan growth stalled while expenses fell, and the company reported strong mortgage production."

"We expect the pressure on the core NIM to continue given today's low rate environment; as such, we believe that it will be difficult for BB&T to continue to grow earnings outside of acquisitions, and with a premium valuation relative to peers, shares will likely remain range-bound in the near term until a more apparent catalyst for growth is visible."

Miller estimates the company will earn $2.44 a share for all of 2013, with EPS rising to $3.05 a share in 2014.

BBT Chart BBT data by YCharts

Interested in more on BB&T? See TheStreet Ratings' report card for this stock.

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

>Contact by Email.

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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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