The banking sector has been witnessing improved earnings this time, with most of the companies delivering better-than-expected results. Further, with higher chances of the Fed rate hike next month, banking stocks are expected to witness a further rise in revenue in the quarters ahead.

Here is one such stock from the sector that reflects strong fundamentals and solid long-term growth opportunity. Hancock Holding Company is a regional southeast bank, with a market capitalization of $2.5 billion. In third-quarter 2016, the company’s earnings outpaced the Zacks Consensus Estimate. Moreover, it has witnessed an upward earnings estimate revision of 3.8% over the past 30 days, indicating analysts’ optimism about its growth prospects.

Further, this Zacks Rank #2 (Buy) stock has risen nearly 35.1% year to date and has witnessed an impressive earnings surprise history. You can see that in the chart below:
 

Further, the company has a number of other aspects that make it an attractive investment option.

Revenue Strength: Hancock’s initiatives to enhance revenues remain impressive. Revenue has been growing at a compounded annual growth rate (“CAGR”) of 4.3% over the last five years (2011–2015). The improvement is backed by strong loan growth. Moreover, the company’s projected sales growth (F1/F0) of 8% ensures continuation of the uptrend.

Earnings Growth: Hancock has witnessed EPS growth of 8.5% over the past 3-5 years. Moreover, this earnings momentum is likely to continue in the near term as reflected by the company’s projected EPS growth (F1/F0) of 7.2%.

Also, the company’s long-term (5 years) estimated EPS growth rate of 8% promises rewards for investors in the long run.

Strong Leverage: Hancock’s debt/equity ratio stands at 0.19, compared with the industry average of 0.37, indicating a relatively lower debt burden. It also indicates the financial stability of the company even in adverse economic conditions.

Declining Expenses: Hancock is focused on streamlining its operations in an effort to improve efficiency. Operating expenses have declined at a 4-year CAGR of 3.1% (2012–2015). The company continues targeting further improvement in operating efficiency through additional review of office areas and branch network.

Valuation Looks Reasonable: Hancock has a Value Style Score of ‘B’. The Value Style Score condenses all valuation metrics into one actionable score that helps investors steer clear of ‘value traps’ and identify stocks that are truly trading at a discount. Our research shows that stocks with Style Scores of ‘A’ or ‘B’, when combined with Zacks Rank #1 (Strong Buy) or #2, offer the best upside potential.

Other Stocks to Consider
    
Some other stocks in the same space worth a look include Farmers Capital Bank Corporation , Carolina Financial Corporation and Ameris Bancorp (ABCB Quick QuoteABCB - Free Report) .

Farmers Capital witnessed an upward earnings estimate revision of 8.3% over the past 30 days. Also, its share price is up 17.1% year to date. It currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Carolina Financial also sports a Zacks Rank #1 and has witnessed an upward earnings estimate revision of 12.9% over the past 30 days. Moreover, its share price is up 26.7% year to date.

Ameris Bancorp currently carries a Zacks Rank #2. It has witnessed an upward earnings estimate revision of 1.3% over the past 30 days, and its share price has risen 8.6% year to date.

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