These 7 Community Banks Are Takeover Candidates Thanks to the FDIC

NEW YORK (TheStreet) -- Regional banks are the key to growing a healthy banking system, and part of the growth should be though acquisitions. Based on Federal Deposit Insurance Corporation data here are seven banks that should be considered takeover candidates and how to trade them.

Associated Banc-Corp  (ASBC) ($18.36) has slowly increased total assets to $25.5 billion with a well-managed pipeline of real estate lending and loan commitments.

The stock rallied 20% from $16.26 on Oct.16 to $19.44 on Nov. 13 and is well above its 200-day simple moving average at $17.83. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week simple moving average at $14.70. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $19.80.

Boston Private Financial Holdings (BPFH) ($12.71) has $6.5 billion in total assets and now has a well-managed pipeline of real estate lending and loan commitments.

The stock set a multiyear intraday high at $14.64 on Jan. 17, then declined 22% to a low of $11.40 on Oct. 15 and is now above its 200-day SMA at $12.78. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $9.82. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $13.79.

Capitol Federal Financial  (CFFN) ($12.57) has increased total assets to $9.9 billion in assets with a well-managed pipeline of loan commitments.

The stock set a multiyear intraday high at $13.12 on Nov. 24 up 14% from a low of $11.54 on Oct.1 and is above its 200-day SMA at $11.90. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $11.16. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $13.20.

National Penn Bancshares (NPBC) $10.23) has $8.6 billion in assets with a well-managed pipeline of loan commitments.

The stock set a multiyear intraday high at $11.63 on Dec. 24, 2013, then declined 21% to as low as $9.17 on Oct.15 and is above its 200-day SMA at $10.23. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $9.35. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $11.57.

PacWest Bancorp  (PACW) ($46.02) has $15.7 billion in assets and is overexposed to CRE loans with a ratio of 353% on loans versus risk-based capital, but the pipeline is well managed. (The regulatory guideline for Commercial Real Estate loans is 300% of risk-based capital.)

The stock set a multiyear intraday high at $47.37 on April 4, then declined 19% to as low as $38.32 on Oct.16 and is above its 200-day SMA at $42.27. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $29.26. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $50.40.

Signature Bank (SBNY) ($121.99) has $26.0 billion in assets with an overexposure to CRE loans with a 496% of risk-based capital with a slightly stressed loan pipeline.

The stock set an all-time intraday high at $133.09 on March 4 then declined 23% to as low as $101.87 on Oct.16 and is above its 200-day SMA at $119.83. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $81.34. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $133.80.

Umpqua Holdings Corp (UMPQ) ($16.97) has $22.5 billion in assets with an overexposure to CRE loans at 423% of risk-based capital but the loan pipeline is well managed.

The stock set a multiyear intraday high at $19.65 on Dec.24, 2013 then declined 23% to as low as $14.94 on Oct.22 and is below its 200-day SMA at $17.31. Investors should enter a "good 'til canceled" limit order to buy weakness to the 200-week SMA at $14.07. Investors looking to book profits should enter a "good 'til canceled" limit order to sell strength to a key technical level at $19.55.

At the time of publication, the author held no positions in any of the stocks mentioned.

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This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.


TheStreet Ratings team rates ASSOCIATED BANC-CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate ASSOCIATED BANC-CORP (ASBC) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, expanding profit margins, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

You can view the full analysis from the report here: ASBC Ratings Report

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