Tickers in this Article: FBNC
The valuation picture looks attractive too with the stock trading at very reasonable multiples to earnings and book value.First Bancorp is a bank holding company headquartered in Southern Pines, North Carolina. It has 96 branches, with 81 in North Carolina, 7 in South Carolina and 8 in Virginia. The company has total assets of approximately $3.2 billion.Third Quarter ResultsFirst Bancorp reported better-than-expected third quarter results back on October 23. Earnings per share came in at 30 cents, beating the Zacks Consensus Estimate of 25 cents. It was a stellar 36% increase over the same quarter last year.Net interest income actually declined 2% year-over-year as the decline in interest income was larger than the decline in interest expense. However, the adjusted net interest margin was relatively stable.Non-interest income more than doubled though, due in part to an 11% increase in service charges on deposit accounts. The company also booked gains on foreclosed properties. Meanwhile, non-interest expenses were basically flat year-over-year.Credit quality improved from the same quarter last year too. The percentage of non-performing loans to total loans improved 170 basis points to 5.00%. And the allowance for loan losses declined 8 basis points to 1.95% of total loans.Estimates RisingFollowing solid Q3 results, analysts revised their estimates meaningfully higher for both 2013 and 2014, sending the stock to a Zacks Rank #1 (Strong Buy).The 2013 Zacks Consensus Estimate is now $1.00, up from $0.91 before the Q3 beat. The 2014 consensus is currently $1.22, up from $1.02 over the same period. It also corresponds with 22% annual EPS growth.First Bancorp has delivered two consecutive positive earnings surprises.Reasonable ValuationShares of FBNC are up more than +12% since the Q3 beat, but valuation still looks reasonable. The stock trades at less than 14x 2014 earnings. And its price to book ratio is just 1.1.The Bottom LineWith solid earnings momentum, strong growth prospects and reasonable valuation, First Bancorp offers investors a lot to like.Todd Bunton, CFA is the Growth & Income Stock Strategist for Zacks Investment Research and Editor of the Income Plus Investor service.Earnings estimates have been rising for First Bancorp (FBNC) following its last positive earnings surprise. It is a Zacks Rank #1 (Strong Buy) stock.