It is amazing the discrepancy between what this bank is worth and what it trades for...everyone worried about credit...well they just got rid of their problem loans...and they were so bad that they were bought for a whopping 3% discount...also, this is the only bank of size to buy in the fastest area of the country...it would go for 4x tangible book and it now trades at 2x...and in terms of credit quality this is one of the most conservative bank managements in the country...they buy credit troubled banks and bring them up to there standards...
The sad fact about this stock is you have inexperienced managers short this stock who ultimately don't understand how banks are priced...earnings from quarter to quarter are meaningless when you are building a franchise to ultimately sell...good luck shorts...have you ever heard of a "wake up price"....remember the term
Also, another reason why the stock is down is because a large financial services hedge fund that is liquidating itself had a large position in the stock - and that couple with the current bank stock environment has exacerbated the downside in the price (trust me, I used to work for this fund.)
In summary, go long and hold on - this is a once every 5 year opportunity to get these banks at these valuations.
not a great time to be in this sector or this bank watch out for big surprise next week if KPMG looks closely at accounting for Heritage and other troubled assets. FSNM cannot put those losses into goodwill and the real losses are due to deterioration after the purchase of the other bank lots of SBA loans, and only 5% tier one capital so not a lot of buffer could be ugly, but we can see when earnings released on 10/29