Pros’ Favorite Regional Banks Were Hammered In Q2 (STT, NTRS, BBT, RF, ZION, FMBI, FITB, OKSB, GRNB, MOFG)

Tickerspy’s Regional Bank Index

REGIONAL BANK INVESTING IDEAS

• Popular long ideas: HBAN, RF, FITB
• Popular short ideas: FITB, HBAN, RF
• Top dividend plays: VLY, PRK, CZNC
• Pro favorites: BBT, STT, RF

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REGIONAL BANK COVERAGE

Smaller banks with a regional or local footprint

• Yield Hunter: Regional Bank Increases Dividend 400% (HBAN, PRK, TRST, R, KNX, JBHT, CNW, MNRO)
• Select Regional Banks Avoid Financial Selloff (STBC, UBFO, IBCP, HBAN, FITB, RF)

REGIONAL BANK CHART

REGIONAL BANK METRICS

Avg. Market Cap:	$1.8B
Avg. P/E Ratio:	16.8
Avg. Div Yield:	2.1%

Overall, it was a brutal second quarter for stocks, with the S&P 500 slumping by nearly -12%, and Pro picks in the regional banking sector fared even worse. With a multitude of components offering various degrees of exposure to different parts of the country and types of loans, it is a stock pickers segment, and some of Wall Street’s best were way off the mark with their latest disclosed holdings.

As a whole, the Regional Bank Stocks Index outperformed the S&P 500 fractionally in the month ended Friday, but most of the stocks got hammered since the end of March.

As of the latest 13f filings, which disclosed holdings from the end of Q1, State Street (STT) was the most popular component of the Regional Bank Stocks Index with 53 Pros counting shares among their top-15 U.S.-listed equity positions. Other favorites based on the same criteria included Northern Trust (NTRS), BB&T (BBT), and Regions Financial (RF), which like State Street boast multi-billion dollar market-caps. All four have slipped by more than -20% over the past three months.

Elsewhere in the sector, Zions Bancorporation (ZION), First Midwest Bancorp (FMBI), and Fifth Third Bancorp (FITB) also slipped by over -15% for the period. The stocks were all among the top-15 holdings of eight or more 13f-filing asset managers as of the most recent disclosures.

Typically, large-caps are favored among the top holdings of professional asset managers. However, investors would have been better suited betting on select small-caps during the second quarter. Top three-month performers Southwest Bancorp (OKSB), Green Bankshares (GRNB), and Midwestone Financial Group (MOFG) all gained more than 20% for the period, and none have a market capitalization greater than $300 million.

Investors can track the Regional Bank Stocks Index for performance trends and a suite of other metrics at tickerspy.com.

Tags: BBT, FITB, FMBI, GRNB, MOFG, NTRS, OKSB, RF, STT, ZION