Yesterday, Valley National Bank (VLY) reported first-quarter earnings per share (EPS) of $0.24 versus $0.21 in the prior year and $0.24 in the third quarter.

The results were $0.01 above expectations. Strong loan growth of 14% from the prior year also offset a decline in the net interest margin from 3.08% to 2.95%. Earnings also benefited from the company’s continued cost-containment efforts.

However, the stock’s performance has been weak due to the market and concerns regarding further interest margin compression. However, lower deposit costs should keep margins relatively stable in 2020, and I still anticipate that the company will report EPS of $1.00 this year.

VLY is a buy below $10.50. My target is $12.50. The returns will be enhanced by the 4% dividend yield.