First BanCorp (FBP): 3 Reasons We Love This Stock

First BanCorp currently trades at $22.50 and has been a dream stock for shareholders. It’s returned 298% since July 2020, more than tripling the S&P 500’s 94.1% gain. The company has also beaten the index over the past six months as its stock price is up 15.7% thanks to its solid quarterly results.

Following the strength, is FBP a buy right now? Or is the market overestimating its value? Find out in our full research report, it’s free.

Why Are We Positive On FBP?

Tracing its roots back to 1948 in San Juan, First BanCorp (NYSE:FBP) is a bank holding company that provides commercial banking, consumer financing, mortgage services, and insurance products across Puerto Rico, the U.S. mainland, and the Caribbean.

1. Long-Term Revenue Growth Shows Strong Momentum

From lending activities to service fees, most banks build their revenue model around two income sources. Interest rate spreads between loans and deposits create the first stream, with the second coming from charges on everything from basic bank accounts to complex investment banking transactions.

Over the last five years, First BanCorp grew its revenue at a solid 7.8% compounded annual growth rate. Its growth surpassed the average bank company and shows its offerings resonate with customers.

2. Outstanding Long-Term EPS Growth

We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.

First BanCorp’s EPS grew at an astounding 30.8% compounded annual growth rate over the last five years, higher than its 7.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

3. Stellar ROE Showcases Lucrative Growth Opportunities

Return on equity (ROE) reveals the profit generated per dollar of shareholder equity, which represents a key source of bank funding. Banks maintaining elevated ROE levels tend to accelerate wealth creation for shareholders via earnings retention, buybacks, and distributions.

Over the last five years, First BanCorp has averaged an ROE of 16.5%, exceptional for a company operating in a sector where the average shakes out around 7.5% and those putting up 15%+ are greatly admired. This shows First BanCorp has a strong competitive moat.

Final Judgment

These are just a few reasons First BanCorp is a rock-solid business worth owning, and with its shares topping the market in recent months, the stock trades at 1.9× forward P/B (or $22.50 per share). Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More Than First BanCorp

Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.

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