Tag Archives: First Niagara Financial

Business, Finance, Occupation & Industry

First Niagara Financial Stock: 9 Critical Numbers

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By John Maxfield, The Motley Fool

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Given that you clicked on this article, it seems safe to assume you either own stock in First Niagara Financial or are considering buying shares in the near future. If so, then you’ve come to the right place. The table below reveals the nine most critical numbers investors need to know about First Niagara Financial stock before deciding whether to buy, sell, or hold it.

But before getting to that, a brief introduction is in order. First Niagara traces its roots back to 1870 with the founding of Farmers and Mechanics’ Savings Bank. In the intervening years, it’s grown into one of the largest regional banks in the Northeastern United States. While it did so, according to Wikipedia, through “the recruitment of new customers, as opposed to the purchase of other firms’ assets,” the same can’t be said of the bank’s growth in the time since the financial crisis. The Buffalo, New York-based bank has completed multiple acquisitions over the last five years, culminating in the recent and anticlimactic departure of its now-former CEO John Koelmel. At present, First Niagara has $37 billion in assets and 360 branches in four Northeastern states.

As you can see in the table above, First Niagara‘s primary strength is in its management of credit risk — the significance of which cannot be overstated. Its nonperforming loans ratio comes in nearly 100 basis points less than the industry average. Beyond that, it pays out an arguably overly generous portion of its net income via dividends.

On the other hand, the more glaring problem is its subpar net interest margin and lackluster return on equity. Not captured by the numbers are the growing pains that First Financial is unquestionably suffering as a result of its aggressive expansion since the crisis. To fund the growth, the bank has increased its outstanding share count from 102.8 million shares in 2007 to nearly 350 million today. And as a consequence, its earnings per share have been sliced in half, going from $0.82 per share down to $0.40, and its quarterly dividend payout followed suit.

Many investors are scared about investing in big banking stocks after the crash, but the sector has one notable standout. In a sea of mismanaged and dangerous peers, it rises above as “The Only Big Bank Built to Last.” You can uncover the top pick that Warren Buffett loves in The Motley Fool’s new report. It’s free, so click here to access it now.

The article First Niagara Financial Stock: 9 Critical Numbers originally appeared on Fool.com.


John Maxfield has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Chart: America's Largest Banks by Assets

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By John Maxfield, The Motley Fool

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I can’t tell you how many times I’ve called one bank or another “the nation’s second (or third, or whatever) largest bank by assets” to help put the bank I’m writing about into context. After doing this countless times, however, I figured that what would really help from a contextual standpoint is a chart. What follows, in turn, is a graph of the nation’s largest lenders — all but one of which has assets in excess of $20 billion.

Source: Standard & Poor’s Capital IQ.

While it’s not obvious from the chart, you can separate these institutions into three different buckets. The first bucket concerns the most widely discussed too-big-to-fail banks: JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo. Then comes the unofficial too-big-to-fail lenders (those with assets in excess of $50 billion and thus subject to the Federal Reserve‘s more stringent stress test process). This group contains U.S. Bank , PNC Financial , and BB&T Bank , among others. And the final group encompasses lesser-known banks like First Niagara Financial and People’s United Financial with between $20 billion and $50 billion in assets.

For those of you interested in bank stocks, I encourage you to use this list to consider diversifying your holdings from those institutions at the top of the list to some closer to the bottom. As I discussed here, it’s at the bottom where you’ll often find the best returns.

With big finance firms still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal, or if finance stocks are a screaming buy today. The answer depends on the company, so to help figure out whether U.S. Bancorp is a buy today, I invite you to read our premium research report on the company. Click here now for instant access!

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

M&T Bank Stock: 9 Critical Numbers

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By John Maxfield, The Motley Fool

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Given that you clicked on this article, it seems safe to assume you either own stock in M&T Bank or are considering buying shares in the near future. If so, then you’ve come to the right place. The table below reveals the nine most critical numbers that investors need to know about M&T Bank stock before deciding whether to buy, sell, or hold it.

But before getting to that, a brief introduction is in order. Established in 1856 as Manufacturers and Traders Bank, M&T Bank is today one of the 20 largest commercial banks in the United States. Headquartered in Buffalo, New York, it operates more than 700 branches and over 2,000 ATMs across eight states, the District of Columbia, and in Toronto, Canada. As of the end of 2012, it had $83 billion of assets on its balance sheet, ranking it in size between Alabama’s Regions Financial and Texas’ Comerica.

As you can see in the table above, from a shareholder’s perspective, M&T Bank exhibits a number of attractive characteristics. Its net interest margin is above average, as are its return on equity and payout ratio. In addition, both of its non-performing loans ratio and its efficiency ratio are lower than average, evidencing a well-run bank that manages credit risk more effectively than its peers. It accordingly follows that the biggest downside is its valuation. Trading at 2.33 times tangible book value, M&T Bank stock is one of the most dearly priced regional lenders in the market today.

The one thing M&T Bank stock investors should be wary about is its recent acquisition of Hudson City Bancorp . To say that this is a transformative deal for M&T Bank is an understatement. With $40 billion in assets, Hudson City will increase M&T’s size by 50% in one fell swoop. But while this sounds good in theory, acquisitions like this rarely work out for shareholders. A perfect example of this is First Niagara Financial‘s recent transformative acquisition of HSBC‘s branch network in the Northeastern United States, which led the CEO of First Niagara to relinquish his post last month.

Discover the “only big bank built to last”
Many investors are scared about investing in big banking stocks after the crash, but the sector has one notable standout. In a sea of mismanaged and dangerous peers, it rises above as “The Only Big Bank Built to Last.” You can uncover the top pick that Warren Buffett loves in The Motley Fool’s new report. It’s free, so click here to access it now.

The article M&T Bank Stock: 9 Critical Numbers originally appeared on Fool.com.


John Maxfield has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. …read more

Source: FULL ARTICLE at DailyFinance