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Since its second quarter report late last month, shares of Flushing Financial Corp. (FFIC) have surged about 15.0% to hit its 52-week high of $15.30 on August 21. The rising share price and positive estimate revisions make this Zacks #1 Rank (Strong Buy) savings and loan holding bank a solid momentum pick.
Impressive Second Quarter Results
On July 24, Flushing Financial announced second quarter 2012 earnings of 31 cents per share, outpacing the Zacks Consensus Estimate of 28 cents by nearly 11%. This was also marginally better than the year-ago earnings of 30 cents. Results benefited from higher net interest income, partially offset by a drop in fee income and higher operating expenses.
Net interest income grew 4.1% year over year to $38.3 million on the back of an 18.3% drop in total interest expenses. However, non-interest income decreased 48.1% to $1.1 million. Furthermore, non-interest expense rose 7.3% to $20.4 million.
Asset quality continued to improve during the quarter. As of June 30, 2012, nonperforming assets declined 7.5% year over year to $117.0 million. In addition, provisions for loan losses remained stable compared with the year-ago quarter at $5.0 million. However, net charges-off jumped 53.6% year over year to $4.7 million.
Earnings Momentum Rising
The Zacks Consensus Estimate for 2012 surged 6.3% to $1.18 per share over the past 30 days, aided by upward revisions from five of six estimates. This implies a year-over-year growth of 2.2%. Also, the Zacks Consensus Estimate for 2013 advanced 4.2% to $1.25, with four of six estimates heading north.
Flushing Financial currently trades at a forward P/E of 12.9x, a 21.9% premium to the peer group average of 10.6x. Moreover, on a price-to-book basis, shares currently trade at 1.1x, in line with the peer group average.
The company has a trailing 12-month return on equity (ROE) of 8.1% compared with the peer group average of 7.3%. This signifies the efficient reinvestment efforts by the company compared to its peers.
Chart Shows Strength
Flushing Financial continuously outperformed its 200-day moving averages over the last six months. Currently, the stock is hovering around its 52-week high. The year-to-date return for the stock is 20.0% compared with the S&P 500’s return of 11.5%.
Based in Lake Success, New York, this entity operates as the holding company for Flushing Savings Bank. Flushing Financial provides a wide range of banking products and services to retail and institutional clients. With a market capital of around $468.8 million, the company competes with Flagstar Bancorp Inc. (FBC) and Banner Corporation (BANR), among others.