good info as usual.
it's interesting because I previously questioned the prior study as I've seen branches popping up on many available corner pads in our area. Wells Fargo has been making a big push locally (NJ) and B of A is beefing up their existing branches adding drive thru ATMs at all of them that can physically support it.
I think virtual banking lends itself well to the middle/upper class as (I believe) it is easier for them to adapt to online banking easily and don't require the physical presence of the full-service bank. The ATM can provide 90% of what most folks need, a large population has always had direct deposit of paychecks, and many cannot hope for a cashless society as quickly as we can get there safely/securely.
I think that branches are important at least initially for when you move into a neighborhood, if you operate a small/local business, the elderly, and for many of those in lower-income categories. For whatever reasons, the elderly and many of the lower income folks want/need to perform their transactions with a teller. My mother (mid-70s) prefers to deal with a teller at her local Wells Fargo for whatever reason by her old-folks community in FL.
What I also believe, is that many are opening physical locations as it is a mechanism for differentiation, promoting the brand, and inviting the neighborhood in. In NJ, we have lots of small community banks and the competition is heating up to grab deposits. How else can they do this without having a physical presence?
I think I mentioned how I have a very bad taste in my mouth from the history of the company, AMIE, and the Ueberroths. Will have another lok, but last time I checked a month or two ago, business was still weak and continued to deteriorate.
On a different Lloyd note - PRSS has quickly become profitable for him.
He's been with the company over 10 years and CEO for 8 of them.
Abbas has done a lot of good/hard work and certainly with the CFO issue over the past year it was definitely added work/headaches and he led the company through it wonderfully. Maybe he's just tired and ready for a change himself?
There isn't really anything for the market to absorb - he decided it's time to move on, and whether it happened now, or further down the road, it would happen at some point. Due to the low trading volume which we all know about, there was certainly going to be some movement with whoever tossed their shares. I think that there are just as many that have seen this so many times that they know the bargain when they see it here and buy the dip knowing it will bounce back...and still be undervalued.
Being that Abbas is sticking around for transitioning, I have to believe it was his decision and he just felt with the company now on solid footing the time was right to move on.
the purpose of this SA article was not for the purpose of a pump job to generate volume to sell. I know you said "usually", but just to clarify a few points:
1. I know the author (he is not me), and the purpose was not a pump job
2. I'm sure you've read the article, but "usually" pump jobs do not provide the level of analysis which the author did in this case, and from multiple angles
3. Eberwein is in this at significantly higher prices - in my eyes, that is your safety net...he's got much more riding, and his track record over the past couple years speaks for itself as far as his successes go. At this time, DRAD is a shining star. In a year or two, we'll be saying the same for HSON. Eberwein has made me a significant amount of money in the past couple years and I have no doubt this will be as successful as most of his other investments have been.
4. I suspect that there will be insider purchases coming. They had been purchasing during the back half of 2013 when the shares were at this level all the way up to about $3.50. The company is in much better shape at this time. Now that the earnings have been announced, officers and directors will have an open window to purchase shares.
the initial drop was going to happen unless company announced a big profit, and that wasn't going to happen.
you have a bunch of people jammed in from the SA article, they pushed it over $3.00, and unless the shares went straight up, you have a portion that would sell as quickly as you did...though you have profits.
the earnings announcement was good, company continues moving in the right direction. things are much better than a year ago, yet shares are lower. the meaning is that some folks are simply getting impatient and don't want to wait any longer.
company is doing what they said they would, they are meeting their guidance, so what was announced today was by no means unexpected. again, you have a bunch of people who jumped in, simply skimmed the report, and were happy to sell just as quickly being most don't have a real interest.
next 6 to 9 months will be very good as the company has clearly turned the corner, losses are being reduced nicely, and they've told you the goal is to get to profitability as quickly as possible. once they end the restructuring expense with Alix it should happen very quickly.
a little patience is needed to get the full value here. some people have it (like the big buyer) and others don't (those racing for the exit today).
non-issue as company has millions left on the buyback and has no problem repurchasing shares at the $1.75 level.
since you're conversing with yourself, why don't you now provide the incorrect answer to yourself?
hello again cparker - a bit early for your obligatory visit, aren't you?
great new id - obvious jealousy.
This bank is extremely highly valued for one posting losses and undergoing a restructuring.
At $18 it is even above the $16 or $17 at most that it would fetch in a buyout today.
Much better banks that are much less expensive and undervalued at this time.
FIG tracked bank transactions announced nationwide last year, excluding investor group deals. Based on their research, there were 264 bank transactions totaling $154.4 billion in assets purchased in 2014. That's up from 200 deals and $109.9 billion in assets during 2013, according to FIG.
As for what banks are buying and which ones are selling: The Olsen Palmer report notes the median buyer has $1.1 billion in assets. Sellers, meanwhile, are predominantly smaller banks, with a median of around $160 million in assets, according to the report. Since 2008, acquirers have been about five times as large as the banks they have purchased. That's a much smaller ratio compared to what has historically been the case, according to the report. Acquirers between $1 billion and $5 billion in assets "were the most prolific in 2014," Olsen writes.
Olsen's reasons for this: "Buyers of this size are in a regulatory size sweet spot," and they likely have "sufficient access to the capital necessary to pursue acquisitions." And lastly, he writes, "buyers in this size range have benefited in recent years from the fact that many of the larger regional and national acquirers have largely been on the M&A bench."
"when the 50 day moving average goes under the 200, it's a sign to sell"
NO! It's not an indication to sell - it just means the shares are going to be weak for a while.
Don't let a chart tell you when to sell out of a position unless you are in it only for trading purposes.
If that's the case, the point you want to find is where the 50 day has peaked and is a little ways into the parabolic downturn...look at the CCUR chart and you can see where that happened during April/May last year. Also notice how the price was bouncing between the 50 day and 200 day - this is what short-term traders do - buy and sell between them. Since the shares were staying below the 50 day, and it was in a downturn, you could see what was coming. Then at Sept 8, you can see the shares bounced up to the 200 day and then back down...again, this is what traders do - trade up/down to those moving averages.
it depends how much faith you put into the charts vs. fundamentals. if you are investing for the longer term it shouldn't matter. the chart and technicals can give you a better point to buy and possibly do some short-term trading, but it cannot predict news - maybe a new contract gets announced and the shares spike higher, maybe they get a buyout, whatever - if you have a valuation in mind and a price you would be happy to buy, I wouldn't let the chart stop you...it's just going to give you the probability that you could buy at a better price, but certainly not a guarantee.
as far as the 50 day moving average below the 200 day - yes, it is a very negative indicator. when you see that pattern form, generally there will be a period where the share price will stay below the 50 day. if it goes higher, you'll generally see the 50 day will be the resistance point - as shares get close, they will continually pull back. my view is that happens because so many other investors are trading by it, so it becomes a self-fulfilling prophecy. at some point, the 50 day will begin to flatten out and stop going lower. that the shares have bounced up from the $5s is a good sign - if it holds at this level above $6, the sooner the 50 day will flatten and can get to the point of beginning to turn up. I think the coming dividend announcement will help get to that point sooner.
I personally value the fundamentals a lot more. The charts may help you in the short-term if you are looking to add more shares, but ultimately I value the fundamentals along with insider ownership and purchasing...these are going to give you a better reading on where things are heading longer-term, which is where the big money gets made.
FYI - you know me on SA.
I use Yahoo interactive chart page and have it plot 50 day moving average, 200 day moving average, and RSI. The ideal time to buy is when the 50 day moving average has bottomed below the 200 day and just begun to turn upwards, along with a very low (below 30) RSI. If the 50 day moving average continues upward as it approaches the 200 day moving average you will see volume pick up and buying will get stronger. When 50 day moving average crosses over 200 day moving average this is called the "golden cross" - you can google it and learn more. When this happens, generally a good rally follows. It will likely take a few months for us to reach that point - maybe sometime in the late spring or summer if we've seen the bottom and will have the price stabilize. As I mentioned before, ultimately, the fundamental reason it happens generally comes down to the company having enough time to make adjustments to correct the problem(s), whatever they may be that caused the shares to fall in the first place, and show some evidence that the changes are having the desired effect - possibly leading up to earnings one or two quarters in the future.