To somealias - the downgrade by AG Edwards is only related to the price runup and not performance. The still rate the stock as one to keep (maintain) but at the price the stock had reached they don't think the near term return is as great as when they rated it a buy (accumulate) IMHO
Well, maybe not a true sell off, but a quick look at the chart over the last few weeks shows an incredable run up in BBK vs. the other regionals/super regionals. You can use excite and others to compare stocks, div, p/e's, etc. and BBK seemed to have blown by most. I think they have room to run in the future, but they clearly blew by at least two houses' near term stock price estimates and they pulled the plug. Market sentiment being what it is and there are traders in this stock, and I guess this is what happens. In any event, their change of opinion does not mean that they don't think BBK is a good stock.
I do think much of the volume was supplied by BBK itself as they bought in for 401K, recent acquisitions, etc. and, given some latitude, they would like to purchase at lower prices themselves if possible. I not exactly sure how all that worked, but I believe I am correct in saying that they are not issuing new stock for any of this. I'd appreciate others' thoughts on this as well.
BBK's decentralization has been a big winner with the public, and their ability to pull off their "regional banking concept" is really helping combat the other boys, big and small. However, their efficiency appears to be hitting a wall (and may even be backsliding, even when excluding non-recurring, merger related expenses). This is due to the fact that the regions, while they have their own infrastructure, are growing faster than the corporate infrastructure and are therefore taxing the systems, recruiting/staffing/training, policy, and other necessarily centralized functions. This leads to a fair amount of redundancy between region and corporate functions, an obvious drain on efficiency. As it relates to systems, the question doesn't revolve so much around the operating sytems themselves, but the relative inflexibility of those systems to keep up with the ever changing demands of BBK, let alone the industry itself.
As it relates to non-traditional banking products (i.e. trust, insurance, etc.) While BBK certainly has all the products, I'm not sold on their quality. Does anyone on this board invest in BB&T mutual funds?? I don't believe they have performed quite so well. My impression is that the other non-core products function much the same. Any thoughts?
Enjoyed your post. Really sums up the sentiments expressed here concerning superior customer service vs. winning the efficiency game. I am not sold on the idea that BBK has to be the MOST efficient to survive. The real question is will a sufficient number of people be willing to pay marginally more for this superior service? I believe they will, but JMHO.
Besides the stock I do have two of BBK's mutual funds. Five of 8 funds have had a down quarter. Two of 8 a down year. Only the Small Company Growth fund has been negative for three years. (Of course I have that one.)When you talk about infrastructure are you speaking only about computer systems and the like? I didn't think they were regional. They only have one data center.Still undecided on whether to hope for an MOE or not. :)