National Securities Reaffirms Buy Rating for StoneCastle Financial Corp (BANX)

StoneCastle Financial Corp (NASDAQ:BANX)‘s stock had its “buy” rating restated by National Securities in a research report issued to clients and investors on Monday. They currently have a $23.00 price target on the investment management company’s stock. National Securities’ price objective indicates a potential upside of 12.97% from the stock’s previous close.

The analysts wrote, “• For 3Q17, StoneCastle posted NII/share of $0.40/share, matching consensus and exceeding the dividend by 2 cents. The company continues to deliver strong and consistent effective yields as the market it operates in is largely unaffected by the spread compression seen in middle market cash flow based lending and has high barriers to entry.

• NAV/share increased to $21.56 from $21.47 Q/Q, largely as a result of unrealized appreciation of $630,000 during the quarter and an out-earned dividend. StoneCastle finished the quarter with only 1.2% of level 3 assets, making NAV much less susceptible to mark-to-model assumptions. We continue to think this greater transparency in NAV should warrant a higher premium to it.

• Additionally, despite US community banks having average annual failure rates of 38 bps, BANX continues to trade significantly wide (in terms of dividend yield) of the Bank of America Merrill Lynch BBB Corporate yield-to-worst index. The past year, the dividend yield on BANX’s stock averaged 385 bps higher than the index yield.

• We are revising our 2017 NII/share estimate to $1.59 from $1.60 and our 2018 NII/share estimate to $1.66 from $1.70. “

A number of other equities analysts also recently commented on the company. JMP Securities upgraded StoneCastle Financial Corp from a “market perform” rating to an “outperform” rating and set a $23.00 price target for the company in a research note on Monday, August 14th. Keefe, Bruyette & Woods reiterated a “buy” rating and issued a $23.00 price target on shares of StoneCastle Financial Corp in a research note on Friday. Oppenheimer Holdings, Inc. set a $21.00 price target on StoneCastle Financial Corp and gave the stock a “buy” rating in a research note on Thursday, August 10th. Finally, Zacks Investment Research downgraded StoneCastle Financial Corp from a “hold” rating to a “sell” rating in a research note on Friday, August 11th. One research analyst has rated the stock with a sell rating and four have given a buy rating to the company’s stock. The company presently has a consensus rating of “Buy” and an average price target of $22.50.

StoneCastle Financial Corp (NASDAQ BANX) opened at $20.36 on Monday. The company has a market capitalization of $133.20, a PE ratio of 12.97 and a beta of 0.20. StoneCastle Financial Corp has a 52 week low of $17.81 and a 52 week high of $20.95.

StoneCastle Financial Corp (NASDAQ:BANX) last posted its quarterly earnings results on Thursday, November 9th. The investment management company reported $0.40 EPS for the quarter, hitting the Zacks’ consensus estimate of $0.40. The firm had revenue of $4.36 million during the quarter, compared to analyst estimates of $4.40 million. research analysts expect that StoneCastle Financial Corp will post 1.58 EPS for the current fiscal year.

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Hedge funds have recently modified their holdings of the business. Wells Fargo & Company MN boosted its stake in StoneCastle Financial Corp by 75.2% in the third quarter. Wells Fargo & Company MN now owns 11,147 shares of the investment management company’s stock valued at $230,000 after acquiring an additional 4,785 shares during the period. BB&T Securities LLC acquired a new position in StoneCastle Financial Corp in the second quarter valued at approximately $248,000. Northern Trust Corp boosted its stake in StoneCastle Financial Corp by 10.7% in the second quarter. Northern Trust Corp now owns 12,870 shares of the investment management company’s stock valued at $262,000 after acquiring an additional 1,240 shares during the period. Macquarie Group Ltd. acquired a new position in StoneCastle Financial Corp in the third quarter valued at approximately $274,000. Finally, Bard Associates Inc. acquired a new position in StoneCastle Financial Corp in the second quarter valued at approximately $422,000. Institutional investors own 32.05% of the company’s stock.

About StoneCastle Financial Corp

StoneCastle Financial Corp. is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to provide stockholders with current income, and to a lesser extent capital appreciation. The Company generally invests in the senior debt, subordinated debt, preferred shares and common stock of community banks.

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