For today’s report I screened through more than 500 finance stocks that are trading below $10 but above one buck. I used FDIC data from their Quarterly Banking Profile for the second quarter of 2012. I found eight bank stocks that are trading below $10 with assets above $10 billion.

The Finance Sector is 12.6% overvalued according to www.ValuEngine.com in an overall environment where there’s a near even split between the number of undervalued stocks versus the number of overvalued stocks.


(Click to Enlarge)

Reading the Table

OV / UN Valued: The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine. BZH is the most undervalued by 59.1%. GFA is the most overvalued by 65.7%.

VE Rating: A “1-Engine” rating is a Strong Sell, a “2-Engine” rating is a Sell, a “3-Engine” rating is a Hold, a “4-Engine” rating is a Buy and a “5-Engine” rating is a Strong Buy. <P/> 3 stocks are rated Strong Sell, 5 are rated Sell, six are rated Hold, and only one, CX, is rated Buy.

Last 12-Month Return (%): Stocks with a Red number declined by that percentage over the last twelve months. Stocks with a Black number increased by that percentage. The best performer over the past twelve months is HOV with a gain of 262.1%. The worst performer over the past twelve months is SKY with a loss of 43.2%.

Forecast 1-Year Return: Stocks with a Red number are projected to decline by that percentage over the next twelve months. Stocks with a Black number in the Table are projected to move higher by that percentage over the next twelve months. The best projected gain is 6.8% CX. The worst projected loss is SKY 19.6%.

P/E Ratios: Only ICA has a reasonable P/E ratio, while the others don’t have one, or the P/E ratio is extremely elevated.

Value Level: is the price at which to enter a GTC Limit Order to buy on weakness. The letters mean; W-Weekly, M-Monthly, Q-Quarterly, S-Semiannual and A- Annual.

Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.

Risky Level: is the price at which to enter a GTC Limit Order to sell on strength.

Financial Stocks Earnings Preview:

Bank of America (BAC) reports earnings on October 17 and their EPS estimate is $.01 per share. This “too big to fail” bank has $1.65 trillion in assets, is exposed to $13.3 billion in Construction & Development loans, but their Commercial Real Estate (CRE) Pipeline (ratio of commitments funded) appears healthy.

First Bancorp. (FBP) reports earnings on October 24 and their EPS estimate is $.05 per share. This $12.9 billion bank has a healthy position in CRE loans.

First Horizon National Corporation (FHN) reports earnings on October 19 and their EPS estimate is $.18 per share. This $25.3 billion bank has a healthy position in CRE loans.

First Niagara Financial Group Inc. (FNFG) reports earnings on October 18 and their EPS estimate is $.18 per share. This $35.1 billion bank has a healthy position in CRE loans.

Huntington Bancshares Incorporated (HBAN) reports earnings on October 18 and their EPS estimate is $.17 per share. This $56.4 billion bank has a healthy position in CRE loans.

KeyCorp (KEY) reports earnings on October 18 and their EPS estimate is $.21 per share. This $84.0 billion bank has a healthy position in CRE loans.

Regions Financial Corp. (RF) reports earnings on October 23 and their EPS estimate is $.20 per share. This $121.3 billion bank has a healthy position in CRE loans.

Synovus Financial Corporation (SNV) reports earnings on October 23 and their EPS estimate is $.02 per share. This $26.0 billion bank has a minor overexposure to CRE loans, and their pipeline is 86.7% funded which is a sign of financial stress.