Analyst Ben Gerlinger believes regional banks remain attractive despite a challenging year
- Citi analyst Ben Gerlinger picks Western Alliance Bancorp, First Horizon Corp., Popular Inc., and Bank OZK as top regional banks
- Regional banks remain ‘very attractive’ for 2024 and the first half of 2025
- These four banks are well positioned for upside through the upcoming fourth-quarter earnings season
- They have high capital levels that allow for share repurchases and growth
Citi analyst Ben Gerlinger has identified Western Alliance Bancorp, First Horizon Corp., Popular Inc., and Bank OZK as the top regional banks to watch. Despite a tumultuous year, Gerlinger believes that regional banks are still very attractive for investors in 2024 and the first half of 2025. These four banks are currently well positioned for upside during the upcoming fourth-quarter earnings season. They also enjoy high capital levels, giving them the option to repurchase shares, increase their growth path, or do both. While the banking sector has faced challenges, including the collapse of Silicon Valley Bank, Signature Bank, and First Republic Bank, Gerlinger remains optimistic about the future of regional banks. With a boost from its acquisition of Signature Bank, New York Community Bancorp has managed to avoid the selloff on recession concerns and other woes. However, KBW is betting that the bank will perform in line with its peers. Overall, regional banks continue to be a promising investment option.
Public Companies: Western Alliance Bancorp (WAL), First Horizon Corp. (FHN), Popular Inc. (BPOP), Bank OZK (OZK), First Citizens Bancshares Inc. (FCNCA), JPMorgan Chase & Co. (JPM), New York Community Bancorp (NYCB), Silicon Valley Bank (N/A), Signature Bank (N/A)
Private Companies:
Key People: Ben Gerlinger (Citi analyst), Christopher McGratty (KBW analyst)
Factuality Level: 7
Justification: The article provides information about the performance and outlook of several banks, citing the analysis of Citi analyst Ben Gerlinger. It also mentions the recent performance of the KBW Nasdaq Bank Index and the SPDR S&P Regional Banking ETF. The article includes some background information about the collapse of three former S&P 500 components from the banking sector and the impact of rapid interest-rate hikes by the Federal Reserve. It also mentions the acquisition of Silicon Valley Bank, First Republic Bank, and Signature Bank by other banks. The article concludes with a mention of KBW downgrading New York Community Bancorp and its upcoming fourth-quarter results. Overall, the article provides factual information about the banking sector and the performance of specific banks.
Noise Level: 3
Justification: The article provides information on the performance and outlook of several banks, but it lacks depth and analysis. It mainly focuses on stock prices and earnings reports without providing much context or evidence to support the claims. The article also includes irrelevant information about the collapse of other banks and a downgrade of New York Community Bancorp. Overall, the article lacks scientific rigor, intellectual honesty, and actionable insights.
Financial Relevance: Yes
Financial Markets Impacted: Regional banks
Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article discusses the performance and outlook of regional banks, indicating their attractiveness for investment. There is no mention of any extreme events or their impact.
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