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TheStreet Open House

5 Lean and Mean Bank Stocks

Stocks in this article: BACWFCDFSPBSBNYORITBOFI

2. Signature Bank


Shares of Signature Bank (SBNY) of New York closed at $90.50 Friday, returning 27% this year.

The shares trade for 2.5 times their reported June 30 book value of $36.10, and for 17.7 times the consensus 2014 EPS estimate of $5.10. The consensus 2013 EPS estimate is $4.55.

The bank's efficiency ratio for the 12-months ended June 30 was 37.28%. Its ROA for the same period was 1.10% and its ROTCE was 12.32%.

Signature Bank had $19.7 billion in total assets as of June 30. The bank is very much a growth story, with net loans and leases growing by 13% year-over-year, through the second quarter. The company in August announced the hiring of " seven seasoned sales professionals" to help grow its equipment leasing subsidiary, Signature Financial LLC, which was formed in March 2012.

KBW analyst Christopher McGratty in August underlined the importance of Signature Bank's leasing business. "Only 16 months old, Signature Financial has now added 19 sales executives in 17 locations throughout the country, and has already booked over $1.3B in new originations since creation," the analyst wrote in a note to clients on Aug. 20.

McGratty rates Signature Bank a "market perform," with a price target of $93.00. In his August note, he added "Signature remains on pace to exceed previous loan growth guidance of $2.2B, in our view." KBW estimates the bank will grow its loans by $2.6 billion this year.

The analyst is in the minority with his rating for Signature bank. Out of 21 sell-side analysts polled by Thomson Reuters, 15 rate Signature Bank a "buy," while the remaining six have neutral ratings.

SBNY Chart SBNY data by YCharts

Interested in more on Signature Bank? See TheStreet Ratings' report card for this stock.

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