We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
6 Reasons to Add F.N.B. Corp (FNB) Stock to Your Portfolio Now
Read MoreHide Full Article
F.N.B. Corporation (FNB - Free Report) stock looks like an attractive investment option now. The company is well-positioned for organic and inorganic growth, given its solid balance sheet and liquidity position, along with decent loan growth. Its efforts to digitize operations will further support growth.
Analysts seem optimistic regarding the company’s earnings growth prospects. Over the past 60 days, the Zacks Consensus Estimate for FNB’s 2024 earnings has been revised nearly 1% upward. Thus, FNB currently carries a Zacks Rank #2 (Buy).
A few factors mentioned below make the FNB stock worth betting on now.
Earnings Growth: F.N.B. Corp witnessed earnings growth of 9.5% in the past three to five years, higher than the industry average of 7.3%. While the company’s earnings are projected to decline in 2024, the trend will reverse after that. In 2025, earnings are expected to grow 9.1%.
Moreover, the company’s long-term (three-five years) projected earnings growth rate of 1% offers rewards for shareholders.
F.N.B. Corp has an impressive earnings surprise history. The company's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 6.3%.
Revenue Strength: F.N.B. Corp is focused on its revenue growth strategy. The company’s revenues witnessed a compound annual growth rate (CAGR) of 5.4% over the last five years (2018-2023). Likewise, net loans saw a CAGR of 7.8% over the same time frame, with the uptrend continuing in the first quarter of 2024. Though revenues declined in the first quarter, the company’s strategic initiatives to improve non-interest income by enhancing its product suite, AI leverage, sustained client acquisition and service expansion are likely to aid top-line growth.
The company’s sales are expected to grow 5.3% in 2024 and 5.7% in 2025.
Synergies From Opportunistic Buyouts: Acquisitions remain a major portion of F.N.B. Corp’s business expansion plan and footprint diversification efforts. Since 2005, the company has successfully integrated several buyouts.
Also, FNB acquired several branches from other banks. In 2022, the company acquired UB Bancorp to expand its presence in North Carolina. Also, it bought Howard Bancorp. These, along with prior deals, will continue to be accretive to the company’s earnings.
Improvement in Operating Efficiency: F.N.B. Corp has been integrating mobile, online and in-branch modes for a seamless and convenient banking experience. The company witnessed a substantial rise in digital traffic over the past few years. It has been building on its ongoing investments in sophisticated technology to enhance customer experience, including integrating its e-Store shopping tool into the FNB Direct mobile app, leading to the creation of the eStore Common app, which will offer a single, universal application for almost all the company’s products and services, and include the ability to apply for several products concurrently.
In 2022, F.N.B. Corp started rolling out its digital e-Store kiosks across all its branches and is on track to expand the branch network in northern Virginia and the Washington, DC, metropolitan area by 2024, as well as increase its automated teller machines network. These initiatives are expected to improve operating efficiency over time.
Steady Capital Distributions: F.N.B. Corp has been regularly paying a quarterly dividend of 12 cents per share. Apart from this, it has a share repurchase program in place. In April 2022, the company announced an additional $150 million of buyback authorization, bringing the total authorization to $300 million. As of Mar 31, 2024, $139.1 million worth of shares remained available under the authorization. Given the company’s strong balance sheet position, its capital distributions seem sustainable.
Favorable Valuation: F.N.B. Corp stock looks undervalued right now with respect to its price-to-book (P/B) and price-to-earnings (P/E) (F1) ratios. It has a P/B ratio of 0.80, lower than the industry average of 0.97. Moreover, the company’s P/E (F1) ratio of 9.50 is below the industry average of 10.84.
Also, the stock has a Value Score of B. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best upside potential.
The Zacks Consensus Estimate for HOMB’s current-year earnings has been unchanged over the past 60 days. HOMB shares have gained 2.1% over the past year.
Earnings estimates for UBSI have also been unchanged for the current year over the past 60 days. Over the past year, the UBSI stock has risen 10.9%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
6 Reasons to Add F.N.B. Corp (FNB) Stock to Your Portfolio Now
F.N.B. Corporation (FNB - Free Report) stock looks like an attractive investment option now. The company is well-positioned for organic and inorganic growth, given its solid balance sheet and liquidity position, along with decent loan growth. Its efforts to digitize operations will further support growth.
Analysts seem optimistic regarding the company’s earnings growth prospects. Over the past 60 days, the Zacks Consensus Estimate for FNB’s 2024 earnings has been revised nearly 1% upward. Thus, FNB currently carries a Zacks Rank #2 (Buy).
A few factors mentioned below make the FNB stock worth betting on now.
Earnings Growth: F.N.B. Corp witnessed earnings growth of 9.5% in the past three to five years, higher than the industry average of 7.3%. While the company’s earnings are projected to decline in 2024, the trend will reverse after that. In 2025, earnings are expected to grow 9.1%.
Moreover, the company’s long-term (three-five years) projected earnings growth rate of 1% offers rewards for shareholders.
F.N.B. Corp has an impressive earnings surprise history. The company's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 6.3%.
Revenue Strength: F.N.B. Corp is focused on its revenue growth strategy. The company’s revenues witnessed a compound annual growth rate (CAGR) of 5.4% over the last five years (2018-2023). Likewise, net loans saw a CAGR of 7.8% over the same time frame, with the uptrend continuing in the first quarter of 2024. Though revenues declined in the first quarter, the company’s strategic initiatives to improve non-interest income by enhancing its product suite, AI leverage, sustained client acquisition and service expansion are likely to aid top-line growth.
The company’s sales are expected to grow 5.3% in 2024 and 5.7% in 2025.
Synergies From Opportunistic Buyouts: Acquisitions remain a major portion of F.N.B. Corp’s business expansion plan and footprint diversification efforts. Since 2005, the company has successfully integrated several buyouts.
Also, FNB acquired several branches from other banks. In 2022, the company acquired UB Bancorp to expand its presence in North Carolina. Also, it bought Howard Bancorp. These, along with prior deals, will continue to be accretive to the company’s earnings.
Improvement in Operating Efficiency: F.N.B. Corp has been integrating mobile, online and in-branch modes for a seamless and convenient banking experience. The company witnessed a substantial rise in digital traffic over the past few years. It has been building on its ongoing investments in sophisticated technology to enhance customer experience, including integrating its e-Store shopping tool into the FNB Direct mobile app, leading to the creation of the eStore Common app, which will offer a single, universal application for almost all the company’s products and services, and include the ability to apply for several products concurrently.
In 2022, F.N.B. Corp started rolling out its digital e-Store kiosks across all its branches and is on track to expand the branch network in northern Virginia and the Washington, DC, metropolitan area by 2024, as well as increase its automated teller machines network. These initiatives are expected to improve operating efficiency over time.
Steady Capital Distributions: F.N.B. Corp has been regularly paying a quarterly dividend of 12 cents per share. Apart from this, it has a share repurchase program in place. In April 2022, the company announced an additional $150 million of buyback authorization, bringing the total authorization to $300 million. As of Mar 31, 2024, $139.1 million worth of shares remained available under the authorization. Given the company’s strong balance sheet position, its capital distributions seem sustainable.
Favorable Valuation: F.N.B. Corp stock looks undervalued right now with respect to its price-to-book (P/B) and price-to-earnings (P/E) (F1) ratios. It has a P/B ratio of 0.80, lower than the industry average of 0.97. Moreover, the company’s P/E (F1) ratio of 9.50 is below the industry average of 10.84.
Also, the stock has a Value Score of B. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best upside potential.
Other Stocks to Consider
A couple of other top-ranked stocks from the same space are Home Bancshares, Inc. (HOMB - Free Report) and United Bankshares, Inc. (UBSI - Free Report) . Both HOMB and UBSI currently carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for HOMB’s current-year earnings has been unchanged over the past 60 days. HOMB shares have gained 2.1% over the past year.
Earnings estimates for UBSI have also been unchanged for the current year over the past 60 days. Over the past year, the UBSI stock has risen 10.9%.