Replies to post #122061 on Savvy Trades and Investments

[SSKILLZ1]

STT

Brought STT Yesterday at $88.27 here is what I like.

1) Based on guidance I expect earnings to be somewhere in the $9.50-10.00 range Analyst estimates are $9.75 so that seems about right which is showing solid growth up from $8.67 in the year ago. Analyst Estimates for FY 26 happen to be for $10.80. I would also say I don't think $11.00 is even out of the question here either. Which means the stock is trading at 9x 2025 and about 8x 2026 estimates which in my opinion is too cheap for this consistent growth. As you can see from the last three years if anything growth is starting to accelerate here.

 
 FY 24 $8.67 
 FY 23 $7.66 
 FY 22 $7.41 
 

2) STT has really focused on returning money back to shareholders. Which means since q3 of FY 22 STT has reduced the share count by 76 million shares or 20%+ of the share count since than. Hence this strategy has been highly accretive and I expect that to continue in the future as well.

Buyback shares is 1 part of the shareholder return the other is the divy. Which is about 3.4% right now. Which is solid but nothing to get too excited about. What is to get excited about is how fast they have been growing the dividend. Last 5 Year Run rate. They are literally growing the dividend about 10% a year, that is solid dividend growth story as well.

 
 2020-2021 (Run Rate) $2.08 
 2021-2022 (Run Rate) $2.24 
 2022-2023 (Run Rate) $2.52 
 2023-2024 (Run Rate) $2.76 
 2024-2025 (Run Rate) $3.04 
 

Conclusion: STT I like the consistency in earnings growth, dividend growth, and share count reduction, paints a very positive picture. In fact I think STT should trade at about 12x, if you believe the $10.80 is very possible in fy 2026 like I do Means the the stock should be worth about $130 over the next 6-12 months, which is why I found $88.27 very attractive. I will buy more on weakness. All is just my opinion, and I could always be wrong though.

[SSKILLZ1]

TFC

I brought TFC at $41.58 yesterday here is what I like.

1) Where I brought it it was yielding 5% which is a nice dividend for a high quality regional banks at this point.

2) Usually regional banks of this size can trade at 1.5X book and in the range of 1.8-2.0X tangible book. If It did that would put the stock price would trade into the low $60's by those metrics. As of right now the stock does trade below book, granted not tangible book, but trading below book is still absurdly low for a bank of this quality and this size.

3) Because there CET1 ratios among other have climbed my guess is they will be waaaaaaaaaaaaaaaay more aggressive buying back share in FY 2025 versus FY 2024, hence I expect them to be more aggressive reducing the share count which should be accretive to earnings going forward.

4) Given guidance I expect earnings to climb from $3.69 in FY 24 to about $4.15 in FY 25. Given the fact that I expect this bank to trade at 13-15 multiple. Even conservatively I expect a $55 stock, which mean the stock is cheap here.

5) Asset quality is also healthy so that is always a plus.

Conclusion: I like TFC here thanks to a solid 5% divy where I brought, Trading at about just 10x 2025 estimates, trading below book value, in my opinion they will be more aggressive with the buyback going forward as well, and solid asset quality. Will add more on weakness. All is just my opinion, and I could always be wrong though.