5. New York Community Bancorp Shares of New York Community Bancorp ( NYB) of Westbury, N.Y., closed at $13.81 Wednesday, returning 19% year-to-date, following a 30% decline during 2011. The shares trade for 1.9 times their reported June 30 tangible book value of $7.14, and for 13 times the consensus 2013 Earnings estimate of $1.04 a share, among analysts polled by Thomson Reuters. The consensus 2012 EPS estimate is $1.13. The company's efficiency ratio during the 12-month period ended June 30 was 41.71%, according to Thomson Reuters Bank Insight. New York Community has long been a dividend story, with the company paying out 25 cents a share for 34 consecutive quarters, for a dividend yield of 7.24%, as of Wednesday's close. Over the years, analysts and investors have questioned the company's ability to continue paying the dividend at this level, since recent earnings have barely exceeded the payout, but investors have clearly grown more comfortable this year, with the company's long-term prospects. New York Community reported second-quarter earnings of $131.2 million, or 30 cents a share, increasing from $118.3 million, or 27 cents a share, during the first quarter, and $119.5 million, or 27 cents a share, during the second quarter of 2011. The sequential earnings improvement mainly reflected an increase in mortgage banking income to $58.3 million during the second quarter, from $35.2 million the previous quarter. The company's net interest margin (NIM) was 3.30%, expanding from 3.24% the previous quarter, but narrowing from 3.50% a year earlier. The sequential improvement in the margin reflected "a record level of prepayment penalty income," within the company's core portfolio of multifamily mortgage loans. For the 12-month period ended June 30, New York Community Bancorp's operating return on average assets (ROA) was 1.16%, while its return on average equity (ROE) was 8.80%, according to Thomson Reuters Bank Insight. KBW analyst Frederick Cannon rates New York Community Bancorp "Outperform," with a $13 price target that has already been exceeded. The analyst in July said he expected "that the core NIM will continue to decline but stronger mortgage banking should offset this impact." The analyst raised his 2012 EPS estimate by 11 cents to $1.14, while leaving his 2013 EPS estimate unchanged at $1.08. Cannon said that "prepayment income and mortgage banking should allow NYB to cover the dividend for the next two quarters at a minimum," and that "barring any M&A transaction that the company may enter then we believe the dividend is safe." Interestingly, KBW analyst Melissa Roberts said on Aug. 27 after the Hudson City/M&T Bank deal was announced that Hudson City's exit from the S&P 500 index "likely paves the way for a new financial addition to the S&P 500 Index, with S&P 400 Index member New York Community Bancorp standing out as a strong contender to replace HCBK. Roberts added that the addition of New York Community to the S&P 500 would force mutual funds tracking the index "to purchase 18.1M shares of NYB." Bank of America Merrill Lynch analyst Kenneth Bruce take the opposite view on New York Community Bancorp's ability to maintain the dividend, rating the shares "Underperform," with a price objective of $11, and saying in July that "NYB, like other thrifts, will likely see more pain ahead from the extended low-rate environment," and that "given the hostile rate backdrop, NYB's elevated payout ratio also remains a concern, should mortgage banking income pull back." Bruce estimates that New York Community Bancorp will earn $1.07 a share for all of 2012, followed by EPS of 83 cents in 2013. NYB data by YCharts Interested in more on New York Community Bancorp? See TheStreet Ratings' report card for this stock.