What isn't a biotech, high-tech, or health care stock but is selling at $119 a share? Give up? It's none other than a bank--a Buffalo bank called First Empire State. In spite of the tough times most banks have had, First Empire's stock, which traded at around 55 in January, 1991, had zipped into the 90s by September, where it hovered for the rest of the year. By December, First Empire was again on the rise, hitting a high of 119 on Feb. 25.

Bulls say the runup may not be over. Investment adviser Andy Addison, editor of Institutional View, a market letter in Franklin, Mass., says both fundamental and technical factors continue to bode well for First Empire. He notes that despite its lofty state, the stock is selling at a discount to the market's price-earnings ratio. He figures First Empire could hit 150.

Based on estimated 1992 earnings of $10.75 a share, the stock is trading at a p-e of just 11. And based on Oppenheimer analyst Cheryl Swaim's 1993 estimate of $13.50, the stock is trading at a p-e of 8.8. Swaim upped her estimate from $12 after First Empire's purchase of two of Midlantic's healthy New York banks, which boosted First Empire's assets to $10.6 billion from $8.5 billion. Selling below bank-group averages, "the stock is cheap," says Swaim. Management, which owns 18%, is shareholder-oriented, she adds. So is Warren Buffett, whose Berkshire Hathaway has a 7% stake.


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