Bank Stocks For Your Momentum Watchlist: MFG, PNBK, ORRF, SHG
In the past months the bank sector has been in the doldrums due to a range of factor and the aftereffects are still being felt. Many investors may still be a bit wary about the sector but there are some pickings that may well be worth looking into. Here is a look at four such bank stocks which have gained momentum in recent times.
Mizuho Financial Group Inc (NYSE:MFG) – After a sharp sell-off in mid-March, the stock has been witnessing a nice uptrend and gained about 20%. The stock is already up 37% over the past year.
On July 2 it emerged that the securities arm of the company was going to go on a hiring spree in the United States. The move from Mizuho Financial Group Inc. was to boost its presence in the lucrative United States market and emerge as one of the top 10 stock and bond underwriters. It was revealed that the Japanese bank was on the lookout to hire in excess of 100 professionals for its trading and investment banking businesses in the United States.
The hiring spree is expected to be completed by the end of March 2024. The announcement was made by the Chief Executive Officer of Mizuho Securities Co Yoshiro Hamamoto. At the time it was noted that Mizuho Financial Group was at 10th position in the United States and was ahead of rivals like HSBC PLC and Deutsche Bank AG. However, the company was seeking to become the first Japan-based bank to hold on to its top 10 spot for the entire year. The hiring drive comes at a time when a drop in deal-making led to job cuts at investment banking behemoths like Morgan Stanley and Goldman Sachs.
Patriot National Bancorp Inc (NASDAQ:PNBK) – Patriot National Bancorp is the parent company of the Patriot Bank and on July 21 Patriot National Bancorp Inc announced that Grace Doherty had been appointed to the Boards of both the bank as well as the Bancorp. The company announced at the time that Doherty held considerable experience since she had forged a successful banking career, having worked for a number of regional banks in the New York area.
Most recently Doherty had been the Group Director of the Digital Bank of the Sterling National Bank. Additionally, she had also been responsible for having built the Small Business and Consumer business at Sterling. Since she left her job at Sterling, Doherty had been working in the capacity of a strategic consultant. In that role, she had been largely involved with the development of innovative and potentially high impact digital programs and product strategies for companies in the financial services sector.
On May 12 the company announced its first quarter financial results for the period ended March 31, 2023. Patriot National Bancorp suffered a net loss of $530000 which worked out to a loss of $0.01 per basic and diluted share. In the previous quarter, the company had generated a net income of $1.8 million, which translated to earnings of $0.45 per basic and diluted share. In the prior year period, the net income had been $800,000, which worked out to earnings of $0.20 per basic and diluted share.
PNBK stock has gained about 19% over the past week.
Orrstown Financial Services Inc (NASDAQ:ORRF) – The parent company of Orrstown Bank announced its earnings for the quarter ended on June 30, 2023, this week. It could be a good time to take a look at some of the major highlights. Orrstown Financial Services Inc reported net income of $9.8 million and the diluted earnings per share for the period came in at $0.94. In the previous quarter, the net income had been $9.2 million. Orrstown Financial Services revealed that the net interest margin for the period stood at 3.83% but in the previous quarter, it had been 3.94%.
The net interest income stood at $7.2 million and that reflected a significant jump from the $6.1 million generated in the previous quarter. Although the company recorded sales of deposits to the tune of $18.7 million from the Path Valley Branch, Orrstown Financial Services still recorded deposit growth to the tune of $7.2 million.
During the second quarter, the company also re-purchased 76,330 shares for $0.20 a share. The board of directors also declared that there was going to be a cash dividend of $0.20 a common share for all investors of record as on August 8, 2023. The dividend would be paid on August 15, 2023.
ORRF stock has been trending higher over the past month with a gain of 24%.
Shinhan Financial Group (NYSE:SHG) – Yesterday the company was in the news cycle after it announced its financial results for the second fiscal quarter. Shinhan Financial Group announced that its net income went down by 3% year on year owing to higher bad debt. The net profit for the quarter stood at 1.26 trillion won, which reflected a year-on-year decline of 3.7%.
The operating profit stood at 1.73 trillion won, which worked out to a rise of 1.1% from the year ago period. Despite the drop in net income, the earnings beat market estimates. The average estimate for net earnings from analysts had been 1.24 trillion won, as per the findings of a survey conducted by YonhapInfomax. The contraction in net profit had been brought about by the fact that the company had put aside a hire loan loss reserve.
The company noted that the reserve was higher by 19%. It is also interesting to note that on July 22 the Shinhan Financial Group stock had been upgraded to a ‘buy’ rating from ‘hold’ by the analysts at StockNews.com.
