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5 Analyst Bank Stock Picks That Are Huge Share Buyback Winners

If there is a set of data results that regulators and the Federal Reserve feel much better about, it’s the recent bank stress test results and the Comprehensive Capital Analysis and Review (CCAR), which was very positive for some of the top banks. The “too big to fail” argument has stayed in vogue and in the regulators’ lexicon since the meltdown in 2008 and 2009. That is with good reason: The banking system was breathtakingly close to failing, and everybody agrees we can’t let the situation deteriorate like that again.

In new Deutsche Bank research report, the analysts feel that some of the top banks are far bigger winners than others, but at the margin they feel that the results overall are very positive for the banking sector. They had three specific reasons why:

  1. Both share buybacks and dividend increases beat expectations.
  2. The results show that banks are more in control of managing their capital levels/deployment.
  3. It supports the view that regulatory pressures are easing on the sector after years of stringent policy.

The analysts also noted this in their report:

While capital deployment levels came in higher than we expected, combined dividend and buyback yields are up just 2.3% versus last year. This may not be enough to offset future earnings pressures from the flattening yield curve, sluggish loan growth, and disappointing capital market revenues (assuming these trends continue).

There were some big winners in the group, and here we focus on the stocks rated Buy at Deutsche Bank.


Deutsche Bank is very positive on this company, as it has fared very well. BB&T Corp. (NYSE: BBT) is a Winston-Salem, North Carolina-based financial services company with more than $180 billion in assets. With a history dating back to the Civil War, and now currently the ninth largest U.S. bank by deposits and sixth largest by number of branches, BBT offers a wide variety of different financial products ranging from consumer and commercial banking to securities brokerage and asset management.

The bank increased the dividend to $0.33 a share from $0.30, which came in above the Deutsche Bank estimates of $0.32. The company plans on buying back $1.8 billion in shares, beginning next quarter, and that was also above the estimates of $1.71 billion.

Shareholders receive a 2.65% dividend. The...