4. City Holding Company Shares of City Holding Company ( CHCO) of Cross Lanes, W.Va., closed at $32.11 last Friday, down 8% year-to-date. Based on a quarterly payout of 34 cents, the shares have a dividend yield of 4.24%. The company's year-to-date ROA was 1.53% as of Sept. 30, and its five-year average ROA was 1.56%. City Holding Company had $2.7 billion in total assets as of Sept 30, with 68 branches in West Virginia, Kentucky and Ohio. The company on Nov. 14 agreed to acquire Virginia Savings Bancorp of Front Royal, for $13.4 million, bringing on roughly $130 million in assets, including five branches, in Northwestern Virginia. Third-quarter net earnings allocated to common shareholders were $11.5 million, or 76 cents a share, increasing from $9.8 million, or 64 cents a share, in the second quarter, and $9.0 million, or 58 cents a share in the third quarter of 2010. The biggest factor in the earnings improvement was a decline in credit costs. The company made no provision for loan loss reserves during the third quarter, compared to credit provisions of $1.3 million the previous quarter and $1.8 million a year earlier. Sterne Agee analyst Kenneth James on Oct. 26 lowered his rating on City Holding Company to "Underperform," or "Sell," from a neutral rating, while lowering his 2012 earnings estimate to $2.46 a share from $2.55, in part because of a heavy risk to earnings "from the revenue concentration (27%) in deposit service charges," which were heavily comprised of overdraft fees, and would "remain under pressure from changes in consumer behavior and potentially new regulations." James also cited the stock's "relatively high valuation" in justifying his downgrade. The shares trade for 12.4 times the consensus 2012 EPS estimate of $2.59, among analysts polled by FactSet, and 1.9 times tangible book value, according to SNL. Out of eight analysts covering City Holding Company, one rates the shares a buy, while the remaining analysts all have neutral ratings.