Fifth Third Bancorp
This top super-regional bank is incredibly cheap right now. Fifth Third Bancorp (NASDAQ: FITB) is a diversified financial services company and the indirect parent of Fifth Third Bank, an Ohio-chartered bank. As of June 30, 2019, Fifth Third had $169 billion in assets and operated 1,207 full-service banking centers and 2,551 ATMs with Fifth Third branding in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee, West Virginia, Georgia and North Carolina.
Fifth Third is among the largest money managers in the Midwest and, as of June 30, 2019, had $399 billion in assets under care, of which it managed $46 billion for individuals, corporations and not-for-profit organizations through its trust and registered investment advisory businesses.
Driven by higher mortgage banking revenues, Fifth Third delivered third-quarter positive earnings surprise of 2.7%. Adjusted earnings per share surpassed the consensus estimates of analysts. A revenue increase, aided by expansion of margin and fee income growth, was a key positive. Moreover, the company displays a very strong capital position.
Shareholders receive a 3.15% dividend. The $32 RBC price target compares with a $31.20 consensus target. The stock last traded at $30.51.
This top mid-cap bank makes good sense for the fourth quarter and into 2020. KeyCorp (NYSE: KEY) operates as the bank holding company for KeyBank National Association, which provides deposit, lending, cash management and investment services to individuals, small and medium-sized businesses.
The company also provides a broad range of sophisticated corporate and investment banking products, such as merger and acquisition advice, public and private debt and equity, syndications and derivatives to middle market companies in selected industries throughout the United States under the KeyBanc Capital Markets banner.
With overall credit remaining solid, earnings and loan deposit and fee growth are positive metrics for the bank. It reported non-interest income of $650 million for the third quarter of 2019, which compared to $609 million for the same quarter of last year.
Investors receive a 3.83% dividend. RBC has set its target price at $22. The consensus target is $19.65, and shares closed at $19.30.
This top regional bank is perhaps one of the best banking plays now. PNC Financial Services Group Inc. (NYSE: PNC) is one of the largest U.S. diversified financial services organizations and the sixth-largest U.S. bank by deposits, with $382 billion in assets.
PNC provides retail and business banking; residential mortgage banking; specialized services for corporations and government entities, including corporate banking, real estate finance and asset-based lending; and wealth management and asset management. With consistent earnings growth and a very positive and growing loan portfolio, the company is a premiere super-regional bank stock to own.
PNC posted a better than expected third-quarter profit, boosted by higher loan growth. The bank’s loan portfolio grew 6.5% to $237.4 billion, with commercial lending accounting for about 67% of total loans. The company remains one of the largest local U.S. lenders by assets, and it said net interest income rose 1.5% to $2.50 billion, as higher loans and lower borrowing costs offset lower interest rates.
Shareholders receive a 3.01% dividend. The RBC price target is $150. The consensus target is $149.88, and PNC closed at $153.07 a share.
With the results for the third quarter posted, and the sector still seemingly out of favor with many portfolio managers, it makes sense to look at some of these outstanding companies. They all pay dependable dividends, so the total return potential combined with a degree of safety makes them good additions to long-term growth accounts, especially given the potential for the sector to outperform going forward.