Understanding how First Financial Bancorp (NASDAQ:FFBC) is performing as a company requires looking at more than just a years’ earnings. Today I will run you through a basic sense check to gain perspective on how First Financial Bancorp is doing by comparing its latest earnings with its long-term trend as well as the performance of its banks industry peers. Check out our latest analysis for First Financial Bancorp

Were FFBC’s earnings stronger than its past performances and the industry?

For the purpose of this commentary, I like to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This blend enables me to analyze different stocks on a similar basis, using the latest information. For First Financial Bancorp, its most recent earnings (trailing twelve month) is US$102.88M, which, against last year’s level, has climbed up by 10.47%. Since these figures are somewhat short-term thinking, I’ve computed an annualized five-year value for FFBC’s net income, which stands at US$71.93M This means generally, First Financial Bancorp has been able to consistently grow its profits over the past few years as well.

What’s the driver of this growth? Let’s see if it is solely due to an industry uplift, or if First Financial Bancorp has experienced some company-specific growth. Over the past couple of years, First Financial Bancorp increased its bottom line faster than revenue by effectively controlling its costs. This resulted in a margin expansion and profitability over time. Eyeballing growth from a sector-level, the US banks industry has been growing, albeit, at a subdued single-digit rate of 8.49% over the prior year, and a substantial 10.95% over the past five years. This suggests that whatever tailwind the industry is deriving benefit from, First Financial Bancorp is able to leverage this to its advantage.

What does this mean?

Though First Financial Bancorp’s past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as First Financial Bancorp gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research First Financial Bancorp to get a better picture of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for FFBC’s future growth? Take a look at our free research report of analyst consensus for FFBC’s outlook.

2. Financial Health: Is FFBC’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2018. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.