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First Business Financial Services, Inc. (FBIZ) Hit a 52 Week High, Can the Run Continue?
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Have you been paying attention to shares of First Business Financial Services (FBIZ - Free Report) ? Shares have been on the move with the stock up 0.9% over the past month. The stock hit a new 52-week high of $36.92 in the previous session.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on July 28, 2022, First Business Financial Services reported EPS of $1.29 versus consensus estimate of $0.91 while it beat the consensus revenue estimate by 4.74%.
For the current fiscal year, First Business Financial Services is expected to post earnings of $4.34 per share on $123.15 million in revenues. This represents a 4.08% change in EPS on a 9.21% change in revenues. For the next fiscal year, the company is expected to earn $4.09 per share on $135 million in revenues. This represents a year-over-year change of -5.84% and 9.62%, respectively.
Valuation Metrics
First Business Financial Services may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
First Business Financial Services has a Value Score of B. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 10X. On a trailing cash flow basis, the stock currently trades at 7.4X versus its peer group's average of 8.5X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, First Business Financial Services currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if First Business Financial Services fits the bill. Thus, it seems as though First Business Financial Services shares could still be poised for more gains ahead.
How Does FBIZ Stack Up to the Competition?
Shares of FBIZ have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Old National Bancorp (ONB - Free Report) . ONB has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of B, and a Momentum Score of B.
Earnings were strong last quarter. Old National Bancorp beat our consensus estimate by 17.95%, and for the current fiscal year, ONB is expected to post earnings of $1.33 per share on revenue of $1.6 billion.
Shares of Old National Bancorp have gained 5.9% over the past month, and currently trade at a forward P/E of 13.93X and a P/CF of 9.24X.
The Banks - Midwest industry is in the top 12% of all the industries we have in our universe, so it looks like there are some nice tailwinds for FBIZ and ONB, even beyond their own solid fundamental situation.
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First Business Financial Services, Inc. (FBIZ) Hit a 52 Week High, Can the Run Continue?
Have you been paying attention to shares of First Business Financial Services (FBIZ - Free Report) ? Shares have been on the move with the stock up 0.9% over the past month. The stock hit a new 52-week high of $36.92 in the previous session.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on July 28, 2022, First Business Financial Services reported EPS of $1.29 versus consensus estimate of $0.91 while it beat the consensus revenue estimate by 4.74%.
For the current fiscal year, First Business Financial Services is expected to post earnings of $4.34 per share on $123.15 million in revenues. This represents a 4.08% change in EPS on a 9.21% change in revenues. For the next fiscal year, the company is expected to earn $4.09 per share on $135 million in revenues. This represents a year-over-year change of -5.84% and 9.62%, respectively.
Valuation Metrics
First Business Financial Services may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
First Business Financial Services has a Value Score of B. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 10X. On a trailing cash flow basis, the stock currently trades at 7.4X versus its peer group's average of 8.5X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, First Business Financial Services currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if First Business Financial Services fits the bill. Thus, it seems as though First Business Financial Services shares could still be poised for more gains ahead.
How Does FBIZ Stack Up to the Competition?
Shares of FBIZ have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Old National Bancorp (ONB - Free Report) . ONB has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of B, and a Momentum Score of B.
Earnings were strong last quarter. Old National Bancorp beat our consensus estimate by 17.95%, and for the current fiscal year, ONB is expected to post earnings of $1.33 per share on revenue of $1.6 billion.
Shares of Old National Bancorp have gained 5.9% over the past month, and currently trade at a forward P/E of 13.93X and a P/CF of 9.24X.
The Banks - Midwest industry is in the top 12% of all the industries we have in our universe, so it looks like there are some nice tailwinds for FBIZ and ONB, even beyond their own solid fundamental situation.