FBIZ: Fourth Quarter EPS on Target; Raising 2013 EPS Estimate by a Nickel - Analyst Blog
11 Februar 2013 - 9:23PM
Zacks
FBIZ: Fourth Quarter EPS on Target; Raising 2013 EPS
Estimate by a Nickel
By Ann Heffron, CFA
First Business Financial Services, Inc.
(NasdaqGM:FBIZ) posted net income of $2.5 million up 6%
from the $2.4 million earned in the year-ago quarter.
Click here to download of free copy of the FBIZ research report:
FBIZ 2-11-13
Diluted earnings per share fell 5% to $0.86
(matching our estimate) from $0.90 in last year’s fourth quarter
due to an increased number of average shares outstanding. In
December 2012, FBIZ sold 1.265 million common shares, raising $29.1
million, which it used to retire subordinated debt.
Compared to the year-ago quarter, fourth quarter
results were boosted by a 6% gain in net interest income due to 3%
growth in average interest-earning assets and an 8 basis-point rise
in the net interest margin, as well as a 41% jump in noninterest
income and a 10% drop in the loan loss provision.
This was partly offset by a 19% increase in total
noninterest expense, largely reflecting 31% higher compensation
costs due to the hiring of additional business development officers
and the start-up of First Business Factors, and a 13% increase in
average diluted shares outstanding.
For the year, FBIZ earned $8.9 million, or $3.29
per diluted share, up 16% from the $7.7 million, or $2.94 per
diluted share in 2011, which excludes a $0.7 million, or $0.29 per
diluted share, one-time tax benefit related to a change in
regulation for net operating loss carryforwards by the state of
Wisconsin.
We are raising our 2013 diluted EPS estimate by a
nickel to $3.05 from $3.00. This increase primarily reflects
changes to our estimates for net interest income, the loan loss
provision, and effective income tax rate.
We note that the ABA Banking Journal ranked FBIZ
15th among all publicly traded banks with $1-10 billion
in total assets (of which there are about 250 companies in the US),
based upon ROE in 2011, which was 12.8% for FBIZ. It is the first
time FBIZ has made this list, and speaks to the tremendous
improvement in operating performance the Company has made over the
last few years.
First Business Financial Services, Inc. (FBIZ or
the Company) is a bank holding company headquartered in Madison,
Wisconsin, with $1.2 billion in total assets at December 31, 2012.
FBIZ specializes in business lending for small-medium-sized
companies with sales ranging from $2-50 million. As an adjunct to
these services, FBIZ also offers banking services to business
owners, executives, professionals, and high net worth individuals,
though this is a less significant part of its business.
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