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Analysts look with favor on BancorpSouth, Renasant Q3 showing

bancorpsouth-squarelogoBancorpSouth’s reported third quarter earnings per share of 26 cents came in a penny below analyst Stern Agee’s estimate but 2 cents above the analysts’ consensus.

Stern Agee said the EPS and the reported $24.9 million in profits reflect steady progress by the $13.2 billion Tupelo-based regional bank but noted stronger revenue growth is needed. The Nashville-based Stern Agee lowered its full year earnings estimate by 2 cents to 98 cents, but says it is sticking with its 2014 estimate of $1.25 and its 2015 estimate of $1.40.

Zacks said the 26 cents matched its consensus estimate and surpassed the prior-year quarter figure by a penny. “The results of BancorpSouth are commendable. Along with its robust mortgage lending business performance, the company benefited from numerous opportunistic acquisitions,” Zacks said.

Most significantly for the quarter, BancorpSouth decreased its provision for loan losses to $500,000, declining from the year-ago figure of $6 million.

rnst_logo_mainZacks kept its neutral rating on BancorpSouth (BSX) while Wunderlich and the Jefferies Group kept their hold rating.

Renasant Bank, BancorpSouth’s Tupelo neighbor, met analysts’ estimates with its reported EPS of 34 cents on profits of $6.6 million. Stern Agee said it expects Renasant’s EPS to gain a “strong lift” in 2014 through an expected annual cost savings of 28 cents annually from its acquisition of Kosciusko’s $1.4 billion First M&F.

“A cost savings from the deal should drop to the bottom line in 2014, along with solid loan growth and the continued reduction in credit services,” the firm said.

Stern Agee said it would nonetheless keep its neutral rating on the $5.7 billion Renasant (RNST). Of seven other analysts reporting, one rated Renasant a strong buy, another a moderate buy and the rest a hold.

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