Brady Gailey, Analyst with Keefe, Bruyette & Woods, Inc., says Hilltop Holdings Inc. (HTH) is one of his favorite stocks this year. One positive catalyst he sees for the company is that it is likely to exit the P&C insurance business.
“They have a more complicated business model. Their business is part commercial bank, part mortgage bank, part investment bank, and then they have a small P&C insurance company,” Gailey says. “I think that they will likely sell their P&C insurance company and focus more on the bank this year.”
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Currently, Hilltop trades between 10 to 11 times earnings. Gailey thinks the company could grow through M&A if the right opportunity presents itself.
“So we think there are a couple of positive catalysts coming up for Hilltop in 2015, and we like the valuation here,” Gailey says.
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