4. Fifth Third Bancorp
Shares of Fifth Third Bancorp ( FITB) of Cincinnati closed at $16.39 Thursday, trading for 1.3 times tangible book value, and for 9.8 times the consensus 2014 EPS estimate of $1.68. The consensus 2013 EPS estimate is $1.63. Based on a quarterly payout of 10 cents, the shares have a dividend yield of 2.44%. Fifth Third reported fourth-quarter net earnings available to common shareholders of $390 million, or 43 cents a share, increasing from $354 million, or 38 cents a share in the third quarter, and $305 million, or 33 cents a share, in the fourth quarter of 2011. The fourth-quarter results included a number of one-time items, and the company continued to increase its mortgage banking revenue. The company's fourth-quarter ROA was 1.33%, improving from 1.23% in the third quarter and 1.08% in the fourth quarter of 2011. The return on tangible common equity during the fourth quarter was 14.1%, increasing from 12.8% the previous quarter and 11.9% a year earlier. Please see TheStreet's earnings coverage for more detail on Fifth Third's fourth-quarter results. O'Connor's price target for Fifth-Third's shares is $17, and he estimates the company will earn $1.70 a share in 2013, with EPS increasing slightly to $1.71 in 2014. The analyst said that "since reporting better than expected 4Q results/2013 outlook, the stock has outperformed the group by 500bps. However, FITB still trades at a 5-10% discount on our 2013-2015E, despite higher returns" than peers. FITB data by YCharts
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