3 Reasons To Bet On Old Second Bancorp (OSBC) Stock Now
Zacks Investment Research | Jun 04, 2017 09:48PM ET
With the finance sector turning out to be one of the best performers last earnings season, we thought of highlighting a stock with plenty of upside potential.
Old Second Bancorp, Inc. (NASDAQ:OSBC) delivered better-than-expected results for the first-quarter 2017. Further, its organic and inorganic growth strategies look impressive.
The company’s shares have gained 69.2% over the last one year, significantly outperforming the Banks - Midwest industry’s rally of 20.1%.
Furthermore, Old Second Bancorp witnessed upward estimate revisions of 14.8% and 10.3% for 2017 and 2018, respectively, in the last 60 days. As a result, the company carries a Zacks Rank #2 (Buy).
Why the Stock is Worth Buying
Earnings Per Share Growth: Old Second Bancorp witnessed earnings per share (EPS) growth of 40% in the last three to five years compared with 11.17% for the broader industry.
Also, the company’s estimated EPS growth rate of 40% for 2017 compares favorably with 10.08% for the industry.
Revenue Growth: The company continues to make steady progress toward improving its top line, with sales recording four-year compounded annual growth rate (“CAGR”) of around 0.7% during 2013–2016. Further, the company’s projected sales growth (F1/F0) of 1.32% indicates constant upward momentum in revenues.
Superior Return on Equity (ROE): The company has an ROE of 9.73%, better than the industry average of 9.4%. This shows that the company reinvests its cash more efficiently.
Other Stocks to Consider
Some other stocks in the same space worth considering include 1st Source Corporation (NASDAQ:SRCE) , Enterprise Financial Services Corp (NASDAQ:EFSC) and Farmers National Banc Corp. (NASDAQ:FMNB) . All these stocks carry a Zacks Rank #2. You can see .
1st Source Corporation witnessed an upward earnings estimate revision of 3.7%, over the past 60 days. Also, its share price gained 38.3% over the last one year.
Enterprise Financial's earnings estimates moved upward by 1.9% over the past 60 days, for the current year. Its share price increased 41.0%, over the last one year.
Farmers National’s current-year earnings estimates were revised 1.1% upward, over the past 60 days. Over the last one year, its share price surged 53.9%.
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