People's bank has lagged the market during the last couple of rally days. It would seem that when investors are excited about the economy and a potential recovery they are not thinking about People's. People's support could be coming from funds who are required to have a stake in the bank, either because it is part of sp500 or because their portfolios have to maintain bank allocations. PBCT is a safe bank allocation if you are required to have such a position. The past couple days doesn't seem to indicate that the market expects PBCT to outperform over the longer term.
Can You see a pattern? The market tanks and PBCT does OK. The market goes up, and PBCT falls. Peoples is a safe stock. It won't go anywhere while the market flounders and will fall when the market moves up. The only investors who really should own this stock are mutual funds that need bank holdings in accordance with their stated mission. Peoples is one of the least risky bank stocks out there but it really has no upside. Some mutual funds have no choice so they have to own it. Those mutuals win if they lose less money than other mutuals. We don't win by losing money; our "relative performance" is not important. Dump this dog.
This is so typical of pbct, the sleepy little conservative bank that could. They don't really excite you much but then again they don't hurt you to much either. Given the divi, and the fact they have never been exposed to the sub prime mess, plus the 2 plus billion in cash, and the fact they have not taken any tarp money, I feel comfortable long term. Remember that in April or May of 2010 they will be allowed to be bought by someone else. If they still have the cash then that alone makes them attractive, or maybe they will buy another bank and grow from there? Either way it looks up. This is'nt a day traders pick but a solid above average return investment over the long term. My only real concern is the fact that Mr. Sherringham has spent over 5 million to date on the Sr. execs. 16th floor renovations alone. Unusual for such a conservative bank, and a little arrogant in your face move to us shareholders during this economic downturn, and to the employees whose pay structure has been changed for the worse recently. I for one am staying put, reinvesting my divi's, possibly buying a little more and waiting for the spring of 2010 to determine my next move for this stock.
Had to reply to my own past posting because it rings so true and it seems that others are actually realizing the truth on why the stock is where it is. Carlson and then Klien were of a like mind and were the ones behind the banks steady but conservative approach to banking. Sound financial fundamentals, customer service, and employee appreciation/benefits. Well along comes P.Sheringham and his perception of how a bank should be run. Spend 5 plus million on the senior executive office space, including a state of the art kitchen with private chef and staff, new luxury sports car etc.. Meanwhile you put close to 3 billion dollars in a glorified saving account where it gets a safe but paltry ROI, you seem to have complicated the transition of Chittenden, and may very well have missed out on the best price time line for a new acquisition opportunity. Your raising some customer fees and employee morale seems to be declining, (I have been a customer since the 60's). Some have posted that it is naive to blame the CEO for the low stock price of late. But with billions in cash, no sub-prime exposure, excellent balance sheet and 7 day full service banking. Why is this bank at 15$? If it ain't the vehicle then it has to be the driver. That being said, I have owned since the original IPO and will continue to do so and reinvest my divi's and maybe even get a little more because in 1 year(April/May 2010) either they are going to grow by using that cash or they are going to be bought for a premium by one of the big boys for their cash and customer exposure. I would like to see the former and have them become their own major force to be reckoned with, while adhering to the fundamentals that got them here.