CSE opened and closed above $8.00 on 12/3. On 12/10 it opened at $7.92, closed at $7.78, and the Special Dividend was declared. In the days following the price dropped pretty much each day. I was shocked and discouraged by the selling action and price action following the Special declaration.
I am encouraged by the price action on the selling date and the date following. The price did not drop as much as I feared it might and it came off the low.
I am wondering how long it will take for CSE to get back to $8.00 per share? The Special Dividend seems to be an indication the Company is expecting improved performance and plans to increase the Quarterly Dividend. Will we see $9.00 before the end of 2013?
The balance sheet is pretty iron-clad now, but don't forget that the stock's book value just dropped by $0.51. Financials are recovering and trading closer to book now (they were discounted before), but with the drop in CSE book I'd expect the stock to move sideways for awhile absent something unexpected, like a buyout. Look at it this way -- it will take at least six months or more to earn back the dividend that the company just paid out. So if the stock was worth eight bucks earlier in the month (before the dividend announcement and payment), then you can expect it to take a few months to reach that level again. I wouldn't really look at CSE as a high flyer. It is a steady, very low risk growth play. Good luck!
tweed...I disagree with that assessment and you can see why now. The stock on these special dividend usually bounce back rather quickly to the pre levels. In case of CSE you can bet it will be short as the company continues to support the stock in $7s. The stock didn't even hit lower buy target of the company in post dividend before it was bought back up. There is a huge support for a solid run regional back like CSE that has a growth prospect with BHS approval this year. We re still cheap on normal valuation of 1.5x book for a typical bank.
Sentiment: Strong Buy