Are Fifth Third Bancorp Shares Still a Bargain?

With shares of Fifth Third Bancorp (NASDAQ:FITB) trading at around $15.55, is FITB an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

Fifth Third Bancorp isn’t one of the most talked about banks due to its smaller size compared to the big five, but it has performed well over the past few years. The company just reported FY EPS of $1.66, which is a 41 percent increase over 2011. Q4 EPS came in at $0.43, beating the estimate of $041. Net income increased to $399 million from $314 million. Q4 profit rose 27 percent, which was mostly due to its stake in Vantiv Inc. (NYSE:VNTV). Part of last quarter’s impressive performance can be attributed to mortgage banking revenue up 29 percent, and corporate banking revenue up 13 percent. There was $87 million in charges related to the termination of Federal Home Loan Bank debt.

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Net income margin decreased to 3.49 percent from 3.56 percent. Fifth Third expects net margin to decrease even more next year to between 3.35 percent and 3.41 percent. For 2013, Fifth Third also expect net charge-offs to fall around $200 million. Furthermore, Fifth Third will set aside less money to cover secured loans in Q1.

So far, early action is looking good based on these results. We’ll see if it holds. For now, let’s take a look at some important number for Fifth Third.