TriCo (TCBK) shares rallied 12% in the last trading session to close at $60.07. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 1.9% gain over the past four weeks.
TriCo Bancshares’ shares rallied and closed yesterday’s session at an all-time high of $60.07 after First Hawaiian, Inc. FHB agreed to acquire TCBK in a $2.01-billion all-stock transaction.
Under the terms of the deal, TriCo shareholders will receive 2.095 FHB shares for each TCBK share, implying a value of approximately $63.12 per share based on First Hawaiian’s July 10 closing price. This represents an 18% premium to TriCo’s previous closing price of $53.61.
The transaction would create a bank with approximately $34 billion in assets, expand First Hawaiian’s presence in California and give TriCo shareholders about 35% ownership of the combined company. Following completion, the TriCo brand is expected to be retained on the mainland, with no branch closures currently planned, further supporting investor optimism.
This holding company for Tri Counties Bank is expected to post quarterly earnings of $1.03 per share in its upcoming report, which represents a year-over-year change of +22.6%. Revenues are expected to be $110.3 million, up 6.5% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For TriCo, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on TCBK going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
TriCo belongs to the Zacks Banks - West industry. Another stock from the same industry, Western Alliance (WAL), closed the last trading session 0.3% lower at $80.49. Over the past month, WAL has returned -3.6%.
Western Alliance's consensus EPS estimate for the upcoming report has changed -3.2% over the past month to $2.33. Compared to the company's year-ago EPS, this represents a change of +12.6%. Western Alliance currently boasts a Zacks Rank of #4 (Sell).
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TriCo Bancshares (TCBK): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).