Tags: U.S. | Bancorp | assets | USB

U.S. Bancorp Snapping up Strategic Assets

By    |   Friday, 16 March 2012 12:06 PM

Minneapolis-based U.S. Bancorp (USB) has been on the acquisition trail, quickly snapping up other banks and their strategic assets. The goal, say analysts: Using financial strength to grow market share.

U.S. Bancorp is the nation’s fifth-largest bank, by assets. And it’s highly diversified by product and region, offering consumer banking, payment services, wealth management and other services.

For fourth quarter 2011, U.S. Bancorp reported revenues of $5.1 billion, up 8.1 percent over 2010. Quarterly net income was 69 cents per share, up from 49 cents.

For full-year 2011, revenues were $19.1 billion, up 5.3 percent over 2010. Net income for 2011 was $2.46 per share, up from $1.73.

For 2012, analysts’ consensus earnings estimate is $2.68 per share. For 2013, the estimate is $2.92.

Solid fundamentals

U.S. Bancorp fuels growth via strategic acquisitions and organic growth. On the acquisition front, U.S. Bancorp keeps adding to its strengths by bolstering its trust business, adding customers and expanding its business in Europe.

Strong loan growth of 5.5 percent this year is expected, according to S&P. U.S. Bancorp’s nonperforming loans are already among the industry’s lowest, just 1.47 percent of total loans.

Lots of analysts admire this solid, if not flashy, bank. Of the 34 analysts followed by Thomson/First Call, seven have strong buy recommendations and 13 have buys, with 13 holds and one underperform.

S&P analysts have a hold rating on U.S. Bancorp, though, citing a valuation that’s over twice that of its industry peers. Analysts also note the bank’s solid fundamentals and prudent underwriting practices.

The bank next reports on April 18.

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Friday, 16 March 2012 12:06 PM
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