2008 Industry Outlook
New opportunities: Florida-based banks are hoping for a rebound.
“We have people saying, ‘Just get me out of bank stocks.’ ”
— Benjamin C. Bishop Jr., chairman, Allen C. Ewing & Co., Jacksonville
[Photo: Kelly LaDuke]
For the gutsy: Buy the stocks of Florida-based banks. Their 15-year bull market ended last year, says Benjamin C. Bishop Jr., chairman of investment banker Allen C. Ewing & Co. in Jacksonville. Valuations plunged, down 44% through the third quarter of 2007. “The Florida banks have just been pummeled,” Bishop says.
Indeed, stock in the largest Florida-based bank, Coral Gables-based BankUnited, Fort Lauderdale-based BankAtlantic, and Sanford-based Federal Trust Bank all could be had for under book value last year.
Buyers in the last bank bear market were rewarded within a couple of years by rising valuations, Bishop says. Many bankers say their non-real estate operations are healthy, and Florida’s continued growth means Florida bank stocks should rebound.
Meanwhile, though, Bishop projects 2008 will be a year of down or flat earnings for banks. “Just about every Florida bank is doing all it can to generate fee income,” he says.