Zions Misses Estimates - Analyst Blog

Zions Bancorp. (ZION) reported fourth quarter 2010 diluted loss per share of 62 cents, falling way short of Zacks Consensus Estimate of a net loss 37 cents per share. The reported earnings was up from a loss of $1.26 per share from the year ago quarter but down from a loss of 47 cents per share in the previous quarter. 

Quarter in Detail

Total net interest income decreased 5.3% year-over-year and 1.4% sequentially to $574.0 million, surpassed the Zacks Consensus Estimate of $556.0 million.

Net interest margin for the quarter was 3.49% compared to year ago quarter of 3.81% and previous quarter of 3.84%.

Non interest income of $113.2 million increased 71.7% from prior-year quarter and 2.7% sequentially. Non-interest expense increased 0.5% from the year ago quarter but decreased 2.8% to $443.4 million.

Net loans and leases was $36.7 billion at December 31, 2010 decreased 2.1% from $37.5 billion at September 30, 2010. The Company witnessed net loan growth in commercial lending during the fourth quarter of 2010 for the first time since late 2008.

Net loan and lease charge-offs were $250.9 million for the quarter compared to previous quarter of $235.7 million, as the Company successfully resolved a significant portion of classified assets.

Average total deposits decreased 1.2% sequentially to $41.2 billion as the Company continued its focus to reduce excess funding.

Nonperforming lending-related assets declined 20.0% sequentially to $1.83 billion from $2.29 billion.

The estimated Tier 1 common to risk-weighted asset ratio was 9.08%, compared to 8.66% in the previous quarter.

Conclusion

Analyst estimates have been moving down in the run up to the earnings release. The average estimate was a loss of 37 cents per share when the company reported earnings.

Zions faces competition from U.S. Bancorp (USB) and Wells Fargo (WFC).

We currently have a Zacks #3 Rank for Zions Bancorp on a short-term basis. We have a Neutral recommendation on a long-term basis.

 
US BANCORP (USB): Free Stock Analysis Report
 
WELLS FARGO-NEW (WFC): Free Stock Analysis Report
 
ZIONS BANCORP (ZION): Free Stock Analysis Report
 
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