Pinnacle Financial Partners is among the small-cap banks best positioned to get a financial pop in 2012 from having been able to recapture money previously set aside for deferred tax purposes, KBW analyst John Barber told CNBC.com Wednesday. The downtown-based bank's fourth-quarter earnings next week will include a $1.4 million allowance reversal that will produce nominal tax expenses during the quarter and for all of 2012. (See the details here.) Couple such financial nitty gritty with an improving economic backdrop and better investor sentiment and you have quite a few people talking about 2012 being a pretty good year for bank stocks.
We believe Pinnacle's chief risks lie in its $659 million construction & development portfolio, of which 58% is residential construction. While the Tennessee market is relatively strong, we believe that we are in a national recession for home building which could well eventually affect Tennessee and Nashville more directly.