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PNC, BK, USB, FITB, SAFM, HRL, Banks - Major Regional Stocks 13.87% undervalued

^{Published on 2011-02-28 10:20:46 - WOPRAI}
 

February 28, 2011/ M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Banks - Major Regional sector and these stocks are the most undervalued as of today. PNC FINANCIAL SERVICES GROUP (NYSE:PNC), BANK OF NEW YORK MELLON CORP (NYSE:BK), US BANCORP (NYSE:USB), FIFTH THIRD BANCORP (NASDAQ:FITB), SANDERSON FARMS INC (NASDAQ:SAFM), HORMEL FOODS CORP (NYSE:HRL) are all expected to go Up as they are undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.

The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:

     Symbol     Company Name                        Last Close     Fair Value     Valuation                   Industry               
     PNC        PNC FINANCIAL SERVICES GROUP        61.88          71.84          13.87% undervalued          Banks - Major Regional 
     BK         BANK OF NEW YORK MELLON CORP        30.63          33.15          7.60% undervalued           Banks - Major Regional 
     USB        US BANCORP                          27.52          28.08          1.98% undervalued           Banks - Major Regional 
     FITB       FIFTH THIRD BANCORP                 14.6           18.29          20.17% undervalued          Banks - Major Regional 
     SAFM       SANDERSON FARMS INC                 41.68          42.85          2.72% undervalued           Food - Meat            
     HRL        HORMEL FOODS CORP                   27.15          45.11          39.81% undervalued          Food - Meat            

Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.

Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.

PNC FINANCIAL SERVICES GROUP (NYSE:PNC) - The PNC Financial Services Group, Inc. operates as a diversified financial services company. It offers retail banking, corporate and institutional banking, asset management, and residential mortgage banking services. Its retail banking products and services comprise deposit, lending, brokerage, trust, investment management, and cash management services. The company also offers corporate and institutional banking products and services, including lending products, such as secured and unsecured loans, letters of credit and equipment leases; treasury management services comprising cash and investment management, receivables management, disbursement, funds transfer, information reporting, and global trade services; and capital markets-related services, such as foreign exchange, derivatives, loan syndications, mergers and acquisitions advisory and related services for mid-sized corporations, government, not-for-profit entities, and large corporations, as well as offers commercial loan servicing, real estate advisory, and technology solutions for the commercial real estate finance industry. In addition, it manages assets on behalf of institutional and individual investors through equity, fixed income, alternative and cash management separate accounts, and funds, as well as offers market risk management, financial markets advisory, and enterprise investment system services worldwide. Further, the company offers distressed assets, such as commercial residential development loans, cross-border leases, consumer brokered home equity loans, retail and non-prime mortgages, and residential construction loans. It primarily operates in Pennsylvania, Ohio, New Jersey, Michigan, Maryland, Illinois, Indiana, Kentucky, Florida, Missouri, Virginia, Delaware, Washington, D.C., and Wisconsin. As of December 31, 2009, the company operated 2,512 retail banking branches and 6,473 ATMs. The PNC Financial Services Group was founded in 1922 and is headquartered in Pittsburgh, Pennsylvania.

BANK OF NEW YORK MELLON CORP (NYSE:BK) - The Bank of New York Mellon Corporation, a financial services company, provides various products and services for institutions and individuals worldwide. The companys Asset Management segment offers a range of equity, fixed income, cash, and alternative/overlay products, as well as distributes investment management products. Its Wealth Management segment provides investment management, wealth and estate planning, and private banking solutions to high-net-worth individuals, families, endowments, and foundations and related entities. The companys Asset Servicing segment offers global custody and fund services, securities lending, global liquidity services, outsourcing, government securities clearance, collateral management, and credit-related services to corporate and public retirement funds, foundations and endowments, and global financial institutions. Its Issuer Services segment provides a range of products and services to fixed income and equity issuers, including corporate trust, depositary receipts, employee investment plan services, and shareowner services. The companys Clearing Services segment offers operational support; trading services; flexible technology; and various investment solutions, including managed accounts, mutual funds and cash management, practice management support, and service excellence to financial intermediaries, broker-dealers, independent registered investment advisors, and hedge fund managers. Its Treasury Services segment includes cash management solutions, trade finance services, international payment services, global markets, capital markets, and liquidity services. Additionally, The Bank of New York Mellon Corporation involves in leasing, corporate treasury, business exits, and corporate overhead businesses; and provides fund accounting and transfer agency services for asset managers and financial advisors. The company was founded in 1784 and is headquartered in New York, New York.

US BANCORP (NYSE:USB) - U.S. Bancorp, a financial bank holding company, provides various banking and financial services in the United States. It generates various deposit products, including checking accounts, savings accounts, money market savings, and time certificates of deposit accounts. The company originates a portfolio of loans comprising commercial loans and lease financing; commercial real estate; residential mortgage; and retail loans, including credit card, retail leasing, home equity and second mortgages, and other retail loans. It also offers wholesale lending, equipment finance, small-ticket leasing, depository, treasury management, capital markets, foreign exchange, and international trade services to middle market, large corporate, commercial real estate, and public sector clients. In addition, U.S. Bancorp provides telebanking, online banking, direct mail, and automated teller machine (ATM) services. The company, through other subsidiaries, provides trust, private banking, financial advisory, investment management, retail brokerage services, insurance, and custody and mutual fund services; and payment services, including consumer and business credit cards, stored-value cards, debit cards, corporate and purchasing card services, consumer lines of credit, ATM processing, and merchant processing. U.S. Bancorp primarily serves individuals, estates, foundations, business corporations, and charitable organizations. As of December 31, 2009, it operated 3,015 banking offices and 5,148 ATMs. The company was founded in 1863 and is headquartered in Minneapolis, Minnesota.

FIFTH THIRD BANCORP (NASDAQ:FITB) - Fifth Third Bancorp operates as a diversified financial services holding company. The companys Commercial Banking segment offers banking, cash management, and financial services; traditional lending and depository products and services; and other services, including foreign exchange and international trade finance, derivatives and capital markets services, asset-based lending, real estate finance, public finance, commercial leasing, and syndicated finance for business, government, and professional customers. Its Branch Banking segment provides deposit and loan, and lease products to individuals and corporations. Its products include checking and savings accounts, home equity loans and lines of credit, credit cards, and loans for automobile and personal financing needs. The companys Consumer Lending segment involves in mortgage and home equity lending activities, such as origination, retention, and servicing of mortgage and home equity loans; and other indirect lending activities, which include loans to consumers through mortgage brokers, automobile dealers, and federal and private student education loans. Its Investment Advisors segment offers investment alternatives for individuals, companies, and not-for-profit organizations. It offers retail brokerage services to individual clients, and broker dealer services to the institutional marketplace. This segment also provides asset management services; holistic strategies to affluent clients in wealth planning, investing, insurance, and wealth protection; and advisory services for institutional clients, as well as advises the companys proprietary family of mutual funds. As of December 31, 2009, the company operated 1,309 full-service banking centers, including 103 Bank Mart locations and 2,358 Jeanie ATMs in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee, North Carolina, West Virginia, Pennsylvania, Missouri, and Georgia. The company was founded in 1862 and is headquartered in Cincinnati, Ohio.

SANDERSON FARMS INC (NASDAQ:SAFM) - Sanderson Farms, Inc., an integrated poultry processing company, engages in the production, processing, marketing, and distribution of fresh, frozen, processed, and prepared chicken products in the United States. It sells ice pack, chill pack, bulk pack, and frozen chicken in whole, cut-up, and boneless form under the Sanderson Farms brand name. Sanderson Farms sells its products to retailers, distributors, and casual dining operators in the southeastern, southwestern, northeastern, and western United States, as well as to brokers. The company was founded in 1947 and is headquartered in Laurel, Mississippi.

HORMEL FOODS CORP (NYSE:HRL) - Hormel Foods Corporation, together with its subsidiaries, produces and markets various meat and food products in the United States and Internationally. It offers meat products, including fresh, frozen, cured, smoked, cooked, and canned meat. The company provides perishable meat products, which include fresh meats, sausages, hams, wieners, and bacon; poultry products that comprise JOTS products; and shelf-stable products, including canned luncheon meats, shelf-stable microwaveable entrees, stews, chilies, hash, meat spreads, flour and corn tortillas, salsas, and tortilla chips. It also offers nutritional food products and supplements, sugar and sugar substitutes, creamers, salt and pepper products, sauces and salad dressings, dessert and drink mixes, and industrial gelatin products. In addition, Hormel Foods offers refrigerated, microwaveable, multi-portion potato-/pasta-based side dish products. The company sells its products through its sales personnel, as well as through independent brokers and distributors. It was formerly known as George A. Hormel & Company and changed its name to Hormel Foods Corporation in January 1995. The company was founded in 1891 and is based in Austin, Minnesota.

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