Stock of the Day

September 9, 2020

First Citizens BancShares (FCNCA)

$2,049.25
-$67.86 (-3.2%)
Market Cap: $29.62B

About First Citizens BancShares

First Citizens BancShares, Inc. operates as the holding company for First-Citizens Bank & Trust Company that provides retail and commercial banking services to individuals, businesses, and professionals. The company's deposit products include checking, savings, money market, and time deposit accounts. Its loan product portfolio comprises commercial construction and mortgage; and commercial and industrial leases, as well as small business administration loans. In addition, the company offers consumer loans, such as residential and revolving mortgage, consumer auto, and other consumer loans. Further, it provides wealth management services, including annuities, brokerage services, and third-party mutual funds, as well as investment management and advisory services. The company provides its products and services through its branch network. First Citizens BancShares, Inc. was founded in 1898 and is headquartered in Raleigh, North Carolina.

First Citizens BancShares Bull Case

Here are some ways that investors could benefit from investing in First Citizens BancShares, Inc.:

  • The stock recently traded at $2,117.11, which is significantly above its 52-week low of $1,490.30, indicating a strong recovery and potential for further growth.
  • First Citizens BancShares, Inc. reported earnings per share (EPS) of $45.10 for the latest quarter, exceeding analysts' expectations of $39.32, showcasing strong financial performance.
  • The company has a solid net margin of 18.55%, which reflects its ability to convert revenue into profit effectively, making it an attractive investment.
  • Analysts have a consensus rating of "Moderate Buy" for the stock, with a price target averaging $2,323.50, suggesting potential upside for investors.
  • The recent dividend announcement of $1.95 per share, with a yield of 0.37%, provides a steady income stream for investors, enhancing the stock's appeal.

First Citizens BancShares Bear Case

Investors should be bearish about investing in First Citizens BancShares, Inc. for these reasons:

  • Despite recent positive performance, the stock has been downgraded by Citigroup from a "strong-buy" to a "hold" rating, indicating a potential slowdown in growth expectations.
  • The company's debt-to-equity ratio stands at 1.68, which may raise concerns about its financial leverage and ability to manage debt effectively.
  • With a current ratio of 1.08, the company is just above the threshold for short-term liquidity, which could pose risks if unexpected expenses arise.
  • Market volatility could impact the stock price, as indicated by its beta of 0.85, suggesting it is less volatile than the market but still susceptible to fluctuations.
  • Analysts have mixed ratings, with seven holding a "buy" rating and seven a "hold," indicating uncertainty in the stock's future performance.