Tag - Scbt

Stone Energy Corp. (Nasdaq:SGY), International Bancshares Corp. (Nasdaq:IBOC) and Celera Corp. (Nasdaq:CRA) are among the new 52-week lows in Wednesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Swift Energy Co. (Nasdaq:SFY), Hughes Communications Inc. (Nasdaq:HUGH), Rosetta Resources Inc. (Nasdaq:ROSE), Polaris Industries Inc. (Nasdaq:PII), Quaker Chemical Corp. (Nasdaq:KWR) and SCBT Financial Corp. (Nasdaq:SCBT).

Mention the “B” word as a viable investment path in this time of great hand-wringing on Capitol Hill and Wall Street, and some might gasp, shake their heads and run away. That word is banks.

Is it time to call the exorcist to oust those demonic thoughts? Not necessarily, because digging beneath the doom-and-gloom headlines of catastrophic failures and loan losses, some financial-services companies are chugging along quite nicely. 

SCBT Financial Corp. (Nasdaq:SCBT), which primarily operates as South Carolina Bank and Trust, appears to have escaped a drenching from the bloodbath. The 75-year-old Columbia, S.C., company operates 50 Carolinas branches.

SCBT’s philosophy is typical of banks that have not been pulled under by the meltdown: know your market, keep the customer satisfied and stick to what has kept you in business. Over the past three months, its share price has risen 26%, and is up 14% year to date. Amid the turmoil, SCBT hit a 52-week high of $45.24 on Sept. 19, contrasted to a July 15 low of $26.25. The stock closed Monday at $36.16.

Analysts who follow SCBT have expressed positive comments. In a Sept. 23 clients’ note, SunTrust Robinson Humphrey’s Mac Hodgson said, “We continue to recommend SCBT as a small-cap stock we want to own long term because it is a standout in terms of credit quality and growth opportunities.” Hodgson has a “buy” rating and a $38 price target, noting “SCBT is among a select few banks that has been able to consistently deliver pristine asset quality and earnings growth … .”

Fig Partners managing principal and director of research Christopher Marinac, who has had SCBT at “outperform,” noted in a report that he’s expecting an earnings uptick this year and next because of “the opportunity and ability of SCBT to . . .

The mortgage industry meltdown has distracted investor attention from high quality lenders, such as SCBT Financial Corp. (Nasdaq:SCBT) and Southside Bancshares (Nasdaq:SBSI), which continue to perform well. Both companies have conservative loan portfolios and double-digit earnings growth.

SCBT Financial has been providing commercial banking services in the Carolinas for over 73 years. The company owns South Carolina Bank and Trust, South Carolina Bank and Trust of the Piedmont, and The Scottish Bank. It operates through 50 financial centers across the Carolinas.  

Location influences regional bank growth rates and SCBT is well-located in a fast-growing region of the Mid-Atlantic. A recent study ranked Raleigh-Cary and Wilmington in North Carolina and Charleston, S.C., among the top 10 cities nationwide for employment growth.

Mortgage loan defaults have not been an issue for SCBT since the company never participated in subprime lending. In the 2008 second quarter, non-performers represented only 0.33% of its total loans. Because of its high asset quality, SCBT is able to capitalize on current growth opportunities that are contributing to record net income.

SCBT’s earnings rose 12.3% in the first six months of 2008, to $12.1 million from $10.8 million in the same period one year ago. Per-share earnings rose modestly to $1.18 versus $1.17 one year earlier, limited by dilution from The Scottish Bank acquisition. Earning assets expanded 20.8% year over year to $2.51 billion from $2.08 billion, and deposits (a source of future loan growth) increased 16.1% year over year to $2.0 billion from $1.7 billion. Analysts think SCBT will produce 12% growth next year and 11% annual growth over the next five years. My $42 target price for SCBT is 12% above Tuesday’s . . .

SCBT Financial Corporation (Nasdaq:SCBT) is up 9% today after it reported after Tuesday’s close that its profit had grown in the second quarter. For the quarter ended June 30, the company reported net income of $6.1 million, or $0.60 per share, compared with $5.6 million, or $0.60 per share, for the same quarter a year ago. The Columbia, S.C.-based company said it expects strong growth throughout the second half of 2008.

“The problems seen at some other banks are not issues for SCBT,” said CEO Robert Hill Jr. in a statement. “Many of the troubled banks are one-product companies that focused on risky types of mortgage lending. We never participated in sub prime lending, and we are a well diversified bank. This company was founded during the depression, and safety and soundness has been a hallmark strength for over 74 years.”

In today’s trading, shares are at $28.99 at 10:43 a.m. ET, up $2.53 from Tuesday’s close. During the past year, shares have ranged from $26.25 to $37.65.