Despite hitting a 52-week high recently, shares of First Fidelity Bancorp. are still cheap when compared with the stocks of other superregional banking companies.

Shares of the New Jersey banking company are trading at a lower market-to-book multiple than those of many similar-size banks. For example, Society Corp. in Cleveland sells at 2.09 times book, while Fidelity's multiple is 1.52.

Analysts say the disparity reflect continuing worries about the Middle Atlantic region's economy and the legacy of First Fidelity's fall from investor grace in the late 1988.

The Confidence Factor

Last week, Thomas H. Hanley, an analyst at First Boston Corp., ungraded the stock to a "buy."

The price level "reflects investors' lack of confidence in management's ability to sustain recent earnings trends," he said.

Mr. Hanley acknowledged that "it is possible to be overly optimistic about the rate of recovery in asset quality" at First Fidelity, where the loan-loss reserve doubled in 1989-1990 to a yearend 1990 high of 3.13%. (As of march 31, the ratio was 3.5%.)

But he said he felt the decline in loan-loss provisioning at the bank, to $61 million in the first quarter from $85 million a year earlier, was sustainable.

Moreover, he thought First Fidelity to be positioned to take advantage of the region's fledgling recovery because of its enlarged market share, cohesive retail franchise, and improved capital position and liquidity.

Growth by Acquisition

The company has grown in recent years mostly through acquisitions of branches of failed thrifts and banks. Most recently, the company entered the New York market by buying five branches in the Bronx and Westchester County that were part of American Savings Bank, a White Plains, N. Y., thrift seized by regulators as week.

First Fidelity, based in Lawrenceville, N.J., was among the highest-flying of the soaring superregional banks four years ago. Wall Street analysts had deemed the company a "story stock" following a merger of New Jersey's biggest bank with Philadelphia's biggest bank.

Banking analyst Nancy A. Bush Brown Brothers, Harriman & Co. recently acknowledged she viewed it "the combination of the century."

She now views the bank's sudden disclosure of both loan and management problems in December 1988 as the opening event of regional banking's "Dark Ages." She was referring to the industry's painful 1989- 1991 cycle the sliding stock prices and asset quality followed by a halting return to health.

Some Surprises

On Dec. 14, 1988, Fidelity's share's plunged 25%, to $27.50 from $35.50, in reaction to news that the company's then-chairman, Harold W. Pote, and is vice chairman, Bernard J. Morgan, were resigning immediately and that a $190 million fourth-quarter loss was expected.

Ms. Bush, at the time an analyst for Dean Witter Reynolds Inc., termed the revelation a "shock" and was sharply critical of the company.

Ms. Bush recommends First Fidelity these days under its management team headed by chairman and CEO Anthony P. Terracciano. She estimates earnings this year at $3.45 to $3.50 a share and expects the stock to move to the low 40s.

Mr. Hanley, meanwhile, expects earnings of $3.65 a share this year and has a 12-month stock price target of $45.

The most optimistic stock price projection for Fidelity is from analyst Michael A. Plodwick, who predicted last month the stock could reach $50 by yearend. His earnings estimate this year is $3.55 a share.

On Monday, Fidelity's shares were up 12.5 cents, to $37.50, a dollar below their yearly high.

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