Prosperity Bancshares: Cheap Relative to Franchise Strength — Buy on NIM Tailwinds and Stellar Deal Flow
Prosperity Bancshares (PB) trades below book and above a reasonable earnings multiple while it ramps scale from the Stellar deal and benefits from improving net interest margins. The stock offers an attractive risk/reward with a 3%+ dividend, modest leverage and ROE that can expand as margins and fees grow. We recommend a mid-term long with discipl…