By Philip van Doorn 06/28/10 - 07:00 AM EDT
Stock quotes in this article: HCBK , PBCT , FNFG , NYB , TRST , CHCO , CCNE
NEW YORK (TheStreet) -- A fresh analysis of publicly-traded U.S. bank and thrift holding companies by TheStreet highlights another 10 bank stocks with attractive dividend yields.
People's United Financial Inc.| PBCT
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First Niagara Financial Group Inc.| FNFG
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Hudson City Bancorp Inc.| HCBK
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An earlier feature on Six Bank Stocks with Solid Dividends was limited to selected names with higher trading volume.
The market has pulled back since that piece was published on May 19, and it seems those names are even more attractive now. Shares of the highly efficient and conservative Hudson City Bancorp(HCBK) closed at $12.68 Thursday, with shares yielding 4.73%. Peoples United Financial (PBCT) saw its yield increase to 4.47%, as shares pulled back to close at $13.87 Thursday, and First Niagara Financial (FNFG) also pulled back, to $12.84, with shares now yielding 4.37%.
To come up with this new list of ten more solid bank and thrift stocks with attractive dividend yields, we again started with first-quarter regulatory data and market data from Thursday's close provided by SNL Financial, paring down the list using the following criteria:
# Bank and thrift holding companies publicly-traded in the U.S., excluding the PinkSheets.
# Dividend yield greater than 4% as of Friday's close.
# Price-to-tangible-book ratio below 2.
# Texas ratio below 20%.
The Texas ratio is a bank's nonperforming loans -- including those in nonaccrual status and loans past due 90 days or more -- divided by core capital and loan loss reserves.
Excluding names trading above two times tangible book value helps narrow down the list to stocks that may still be undervalued in the wake of the banking crisis, but the approach leaves out some stellar names, including New York Community Bancorp (NYB). This company's shares returned 11% year-to-date through Thursday and were yielding a fat 6.39% on a 25 cent quarterly payout. New York Community was recently featured in TheStreet's Best In Class series.
We took a further conservative step this time, excluding companies that paid out more in dividends than they earned over the year ended March 31.
