HCBK: Profit Will Jump 50% This Year!

Hudson City Bancorp Inc (HCBK) Many financial stocks have gotten hammered by the ongoing credit crunch. But Hudson City Bancorp (HCBK) has gone about its business largely unscathed. This Paramus, N.J., company, founded in 1868, is the type of regional bank long-term investors have often relied on for slow, steady growth. The bank operates Hudson City Savings Bank through 121 branches in the New York metropolitan area, which includes New York, New Jersey and Connecticut. Its primary business is mortgage loans, which it originates using customer deposits. The bank focuses on jumbo home loans. While that business has been seriously hurt, Hudson hasn't suffered the same level of loan losses that many competitors have. It avoided risky subprime loans during the housing bubble, a move that has helped keep its earnings track record intact. Profit has steadily increased for at least the past eight years. Its five-year earnings per share growth rate stands at 14%. Wall Street analysts expect stronger growth ahead. They see a 50% profit jump this year and 30% the next. Hudson's chairman, president and CEO, Ronald Hermance, said last month that Wall Street analysts' profit forecasts were "reasonable," citing improved interest margins, higher mortgage production and still-strong credit quality. The stock reached a record high May 2 before pulling back 19%. It has since found support at its 40-week moving average and may be shaping the bottom of a base. Good Trading!