Can't believe it's been 6 years, but DS has been very disciplined and methodical in buying, just the way a good banker should be.
Awesome idea. Most of the major owners in MBRG seem more than willing to buy more shares, especially at the discounted price they would get with a rights offering. Not sure anybody on the board is even looking at a takeover target, but I'm sure DS could find ways to invest new capital at attractive rates of return. I'd be on board.
Another good quarter, as the sale of Southern Trust was finalized and the bank celebrated it's 90th birthday
- Dividend increase from $0.07/quarter to $0.10/quarter
- Q2 Net Income of 1.86 million, $0.26/share
- Total Deposits hit the $1 billion mark
- Assets Under Management by the Investment Group rose to $1.68 billion
- Non-performing assets down to 1.57% of total assets, down from 2.04% last quarter
- Shareholder equity increased to $119 million, a book value of $16.73/share
Good question. Architectural branding stops being important only when physical branches stop being important. And they're still important to some degree. Otherwise MBRG wouldn't have branches near shopping malls or in downtowns. If they didn't care about branches, they'd close everything except a small single branch out in the middle of nowhere, and try to be 100% online. But as of now, physical bank branches are still important to some people, and even in James Gorman's new bank world, small banks will continue to be a place to grab a cup of coffee, meet with your investment advisor, and check on your safety deposit box holding grandma's diamonds.
Interesting idea. You usually see more bank mergers during tough financial times. A stronger more sound bank will get a bargain on a weaker bank and carry it through tough times. Seems like every bank was merging in 08/09, and if MBRG didn't get government money, they may have been acquired too.
The architectural branding doesn't exactly match, but I suppose that could be changed. Besides taking away a competing bank, do you see any other synergies?
By the way, yes I also own Dominion shares. That one's a no-brainer.
In 2008 Berkshire lent USG $300 million at 10% interest and options to buy shares at $11.40. Berkshire just exercised those options. Pram Watsa's Fairfax Financial got the same sweet deal.
Agreed there may be some dinosaurs there, and the management division has grown at a fairly slow rate, and they have a lot of room for improvement. But do you really want a bank without an asset management division, especially when the CEO of Morgan Stanley says it's all small banks will become in the future? Right now they're sitting on over $1 billion under management, and Middleburg Trust is paid a percentage of the amount being managed. That's easy money. Grier seems to be solid, and the new LPL platform will work well for them. I think if it's managed right, it could be lucrative.
Interesting article in todays WSJ by James Gorman titled The Future of Finance. Gorman predicts that brick and mortar branches will become little more than coffee shops, big banks will take care of most all the loans, and small banks will serve niche functions and "asset management will become the single-largest segment of financial services." If that's the case, hope MBRG continues building the asset management division.
That phrase is based on historical evidence. If you look at the stock market as a whole, all the gains throughout history have come between November and May. So in general, it's best to put money in stocks in November, take them out in May, and go on vacation all summer, having fun with your gains.
Also I think that guy who pumped WVVI without shame probably sold his shares, I think it was Networthdev or something like that. Nearly all the message board posts were done by him.
And a third thing, as I've said all along, if you want a real wine stock to hold long term, get into STZ. It's above $90 now, and it grows at a much faster clip than WVVI.
Saw today Shook sold over 10,000 shares. Probably options related, but still not very encouraging when the CEO is disposing of his stock.
I've noticed there are always a few smokers around that park, but a bigger indicator of quality control seems to be the conditions of the landscaping. Is the lawn care budget $0 now? Are they asking for volunteers to take care of the grass? This year there are weeds everywhere, and the grass is always overgrown.
With the current earnings, yes it's insane. But if in 5 years they are generating earnings of $7-12 a share, paying out $5-8 in dividends, the stock would rise to $200 or more. We'll see, it's just a guess.
I'm sure there are a number of ways to 'do the math', but here's my quick attempt. Spending $14 billion on new projects over the next 5 years with a 15% return on equity, means $2.1 billion in extra income each year. With the current # of shares, earnings would be $7/share. $7 x last year's PE of 24.5 and you get a share price of $168. That doesn't factor a few things - the electric rate increase they applied for, any rise in nat gas prices, nor any acquisitions beyond the current projects. My best guess is D is above $200/share in 5 years.
Anybody know what DRU, DCUA, DCUB are? Are those bonds of Dominion that trade with stock symbols? For example, some people think DRU is preferred shares, but others say DRU is junior subordinated notes. And then what is DCUA/B?