Analysts Offer Insights on Financial Companies: First Cash (NASDAQ: FCFS), Zions Bancorp (NASDAQ: ZION) and KKR & Co (NYSE: KKR)By Ryan Adsit
Companies in the Financial sector have received a lot of coverage today as analysts weigh in on First Cash (NASDAQ: FCFS), Zions Bancorp (NASDAQ: ZION) and KKR & Co (NYSE: KKR).
First Cash (NASDAQ: FCFS)
“We recently attended the FCFS analyst day – the first group meeting held with analysts since the completion of the game-changing merger with CSH. Key topics addressed included a review of core trends in both the US and Mexico, synergy plans, organic growth opportunities, and capital allocation plans. We continue to recommend FCFS given its multi-faceted paths to generate earnings growth, defensive balance sheet positioning and economic / rate neutrality. Multi-faceted, straightforward opportunities to drive earnings growth for the intermediate term: As we detail herein, at the base – which includes low / no US organic growth, 8-10% Latin America growth and identified cost synergies – FCFS can drive 15-20% EPS growth. Beyond this, FCFS has many paths to incremental growth, including (i) share repurchases, (ii) consolidation (iii) reductions in cost of financing, and (iv) geographic expansion. Note that none of these strategies relies upon support or tailwind from the operating environment (such as increasing activity from the US consumer or rising gold prices), which would increase growth.”
According to TipRanks.com, Hecht is a 5-star analyst with an average return of 8.0% and a 72.3% success rate. Hecht covers the Financial sector, focusing on stocks such as Hercules Technology Growth Capital, Pennantpark Investment Corp., and Consumer Portfolio Services.
Currently, the analyst consensus on First Cash is Strong Buy and the average price target is $60, representing a 22.8% upside.
In a report issued on November 11, JMP Securities also reiterated a Buy rating on the stock.
Zions Bancorp (NASDAQ: ZION)
Jefferies analyst Ken Usdin reiterated a Hold rating on Zions Bancorp (NASDAQ: ZION) today and set a price target of $41. The company’s shares closed last Friday at $36.97, close to its 52-week high of $37.04.
“Meetings with ZION’s CFO highlighted confidence around NII and loan growth, with potential to beat consensus, in our view. Cost control remains a focus, fee initiatives are budding, and capital return should improve. Mgmt. is cautiously optimistic on energy credit, with few issues in the non-energy book. We raise ’17 and ’18 EPS ests. to $2.35 and $2.75, resp., on higher NII ests. PT to $41 reflects the group re-rating and ZION’s clearer EPS trajectory. Net. int. income could beat Street expectations in ’17. Mgmt. sounded confident in growing loans in the mid single-digits over the next year, with less run-off in energy and owner-occupied, and growth in non-energy C&I, some CRE, and resi. mortgage. Securities growth should continue at an aggressive pace, with wholesale borrowings available as another funding source. The guide for NII calls for mid-to-high single-digit growth over the next 12 months from 3Q16, with the median Street est.”
According to TipRanks.com, Usdin is a top 25 analyst with an average return of 16.3% and a 85.5% success rate. Usdin covers the Financial sector, focusing on stocks such as Huntington Bancshares Inc., Astoria Financial Corp., and Capital One Financial.
Zions Bancorp has an analyst consensus of Moderate Buy, with a price target consensus of $37.40.
KKR & Co (NYSE: KKR)
“Last week we spent time with members of KKR’s IR team led by Craig Larson. Americas XII is primed for launch in 1H17 with a net ~$95M of incremental fee related earnings and while investment in the US remains opportunistic, the opp set in Asia, real estate, and credit offers significant runways of growth potential.”
According to TipRanks.com, O’Hara is a 3-star analyst with an average return of 8.5% and a 90.0% success rate. O’Hara covers the Financial sector, focusing on stocks such as Fortress Investment, Och-Ziff Capital, and Blackstone Group.
Currently, the analyst consensus on KKR & Co is Strong Buy and the average price target is $23, representing a 56.0% upside.
In a report issued on November 3, Credit Suisse also reiterated a Buy rating on the stock with a $17 price target.