The Southeast Banks industry group, of which Ameris is a part, currently ranks No. 25 of the 197 groups IBD measures and has been in the top 30 for several weeks. This is a bullish sign because stocks in the top 40 industry groups tend to represent market leaders.
Ameris Bancorp had been holding near recent highs after reporting first-quarter 2021 earnings that beat estimates on April 22.
The stock features a strong IBD Composite Rating of 96, alongside a solid 92 Relative Strength Rating and an acceleration in bottom-line growth on a year-over-year basis.
Additionally, the Atlanta-based company currently ranks No. 17 among companies in its industry group in terms of Composite Rating. This shows there is a high number of companies in the Southeast Banks industry group with strong Composite Ratings. Ameris is definitely in good company.
The regional bank operates through 170 offices in Georgia, Alabama, Florida and South Carolina.
Ameris Bancorp Earnings
The firm posted a Q1 sales increase of 21% to $272 million. Meanwhile, EPS growth went from a 53% jump to a 196% increase in the past two quarters. In addition, the company’s latest top and bottom line increases met the minimum of 25% that IBD’s CAN SLIM strategy looks for in leading growth stocks.
“We are pleased with our first-quarter results, where we saw solid loan growth, increases in core deposits, stable credit, robust fees and continued momentum in our banking division efficiency initiatives,” said Palmer Proctor, CEO of Ameris, in a recent news release.
“An improving economy, along with the tremendous core earnings power of Ameris, resulted in tangible book value growth of 6.7% this quarter,” he added.
Analysts expect the bank’s second-quarter earnings to show high double-digit growth. According to IBD data, earnings are expected to climb 95% to $1.19 a share in Q2. However, analysts expect revenue to decline 9% on a year-over-year basis to $267 million.
Growth Stock Nears Buy Point
Shares are trading above the 50-day moving average and have held solid support above this area since the bank reported earnings. Meanwhile, the stock’s relative strength line has also been trending higher since mid-April after a period of drifting lower. Ideally, the RS line will be at or near new highs as the stock breaks out.
Ameris stock remains just below a 57.91 buy point of a cup-with-handle base.
Those who are watching Ameris should wait to pull the trigger until the stock breaks out above the buy point — preferably in heavy volume.
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