2. Regions Financial Shares of Regions Financial ( RF) of Birmingham, Ala., closed at $6.59 Friday, returning 54% year-to-date, after a 38% decline last year.
The shares trade for nine times the consensus 2013 EPS estimate of 75 cents. The company owes $3.5 billion in TARP money, which it expects to repay in April. Regions on March 19 commenced a $900 million common stock offering, and said that including the offering's net proceeds of $875 million, the money from its pending sale of Morgan Keegan to Raymond James Financial ( RJF) sale and a full redemption of TARP preferred shares held by the U.S Treasury, that its Tier 1 common equity ratio its Tier 1 common equity ratio, based on fourth-quarter numbers, would be a strong 9.51%. The company will report its first-quarter results on April 24, with a consensus EPS estimate of seven cents. Deutsche Bank analyst Matt O'Connor rates Regions a "Buy," and on Friday raised his price target for shares by a dollar, to $7.50. O'Connor's first-quarter outlook for Regions "reflects lower net interest income given lower earning assets (continued run-off of RF's investor real estate and home equity portfolios) and higher mortgage prepayments in the securities book. However, offsets to these net interest margin headwinds are opportunities lower funding costs, reduce excess cash levels and continued pricing discipline on loans." Interested in more on Regions Financial? See TheStreet Ratings' report card for this stock.