Fulton Financial to Reward Shareholders - Analyst Blog

Fulton Financial Corporation FULT continues to boost shareholder value. This Lancaster, PA-based bank recently authorized a 4 million (2.1% of total shares outstanding as of Apr 30, 2014) share repurchase program. The company aims to complete this buyback plan by this year end.

This is the second time in the past one year that Fulton Financial has announced a new share buyback plan. Earlier in Oct 2013, the company had authorized repurchase of 4 million shares by the end of Mar 2014, which was successfully completed.

Prior to this, Fulton Financial had announced a buyback plan of 8 million shares in Jan 2013, with an intention to complete it by June. However, the company was unable to meet the time line and consequently extended the program through Sep 2013.

Apart from steady share repurchase authorization, Fulton Financial also pays regular quarterly cash dividend of 8 cents per share, since Oct 2012, when a 14.3% hike was announced. The current dividend yields 2.68% to the shareholders.

Moreover, Fulton Financial's liquidity position remains strong, with cash and due from banks of $260.4 million as of Mar 31, 2014, up 19% from $218.5 million as of Dec 31, 2013. Further, the company remains well capitalized with Tier 1 capital ratio of 13.1% and Total capital ratio of 15.0%. Both ratios are considerably above the regulatory requirements.

Notably, in first-quarter 2014, Fulton Financial returned approximately $65 million to shareholders through dividend payments and share repurchases. We believe that the company will continue to enhance shareholder value going forward given its strong balance sheet position.

Fulton Financial carries a Zacks Rank #3 (Hold). Some better-ranked north-east banks include S&T Bancorp Inc. STBA, Territorial Bancorp Inc. TBNK and Univest Corporation of Pennsylvania UVSP. All these sport a Zacks Rank #1 (Strong Buy).