Stocks & Investing
Fri, August 19, 2011PACW, SIVB, UMPQ, CACB, NOVB, CYN, Banks - West Stocks Undervalued
Published in Stocks and Investing on Friday, August 19th 2011 at 7:43 GMT by WOPRAI
August 19, 2011/ M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Banks - West sector and these stocks are the most undervalued as of today. PACWEST BANCORP (NASDAQ:PACW), SVB FINANCIAL GROUP (NASDAQ:SIVB), UMPQUA HOLDINGS CORP (NASDAQ:UMPQ), CASCADE BANCORP (NASDAQ:CACB), NORTH VALLEY BANCORP (NASDAQ:NOVB), CITY NATIONAL CORP (NYSE:CYN) are all expected to go Up as they are Undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.
The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:
Symbol Company Name Last Close Fair Value Valuation Industry
PACW PACWEST BANCORP 14.86 26.51 43.90% Undervalued Banks - West
SIVB SVB FINANCIAL GROUP 42.93 55.32 22.40% Undervalued Banks - West
UMPQ UMPQUA HOLDINGS CORP 9.2 15.19 39.40% Undervalued Banks - West
CACB CASCADE BANCORP 7.57 30.28 75.00% Undervalued Banks - West
NOVB NORTH VALLEY BANCORP 9.75 18.72 47.90% Undervalued Banks - West
CYN CITY NATIONAL CORP 40.62 66.7 39.10% Undervalued Banks - West
Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.
Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.
PACWEST BANCORP (NASDAQ:PACW) - PacWest Bancorp operates as the bank holding company for Pacific Western Bank that provides banking products and services primarily in southern and western California. It accepts time, money market, and demand deposits; originates loans, including commercial, real estate construction, SBA guaranteed, consumer, and international loans; and provides other business-oriented products. The company also provides asset-based lending and factoring of accounts receivable to small businesses located in Arizona, California, the Pacific Northwest, and Texas. In addition, it offers international banking, multi-state deposit, and investment services; telephone and online banking services; and foreign exchange services, as well as issues automated teller machine and debit cards. As of December 31, 2009, PacWest Bancorp operated 68 full-service community banking branches in Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Francisco, San Mateo, and Ventura Counties. The company was formerly known as First Community Bancorp and changed its name to PacWest Bancorp in May 2008. PacWest Bancorp was founded in 1999 and is based in San Diego, California.
SVB FINANCIAL GROUP (NASDAQ:SIVB) - SVB Financial Group, a diversified financial services company, operates as the bank and financial holding company that provides commercial banking and financial products and services. It offers various deposit products, including traditional deposit and checking accounts, certificates of deposit, money market accounts, and sweep accounts. The companys lending products and services include traditional term loans, equipment loans, asset-based loans, revolving lines of credit, accounts-receivable-based lines of credits, capital call lines of credits, mortgages, home equity lines of credit, restricted stock purchase loans, airplane loans, and other secured and unsecured lines of credit. It also offers cash management products and services, including wire transfer, automated clearing house payment, collection, disbursement, electronic funds transfer, and online banking; foreign exchange services, lockbox and merchant services, international trade finance, and letters of credit, including export, import, and standby letters of credit; and money market mutual funds, fixed-income securities, asset management, brokerage, and investment advisory services, including outsourced treasury services. In addition, the company provides non-banking products and services, such as funds management, private equity investment, and equity valuation and management services to private companies and venture capital firms. As of December 31, 2009, it operated 27 offices in the United States, as well as offices internationally in China, India, Israel, and the United Kingdom. SVB Financial serves customers in the technology and life sciences, venture capital/private equity, and premium wine industries. The company was founded in 1982 and is headquartered in Santa Clara, California.
UMPQUA HOLDINGS CORP (NASDAQ:UMPQ) - Umpqua Holdings Corporation operates as the bank holding company for Umpqua Bank that provides commercial and retail banking services to corporate, institutional, and individual customers primarily in the areas of Oregon, northern California, and Washington. The companys deposit products include non-interest bearing checking accounts, interest bearing checking and savings accounts, money market accounts, and certificates of deposit. The companys lending portfolio comprises commercial loans and commercial real estate loans for business and commercial customers, including accounts receivable and inventory financing, equipment loans, real estate construction loans, and permanent financing and small business administration program financing, as well as loans for small businesses; residential real estate loans for construction, purchase, and refinancing of residential owner-occupied and rental properties; and consumer loans to individual borrowers, including secured and unsecured personal loans, home equity and personal lines of credit, and motor vehicle loans. Umpqua Holdings Corporation also offers retail brokerage services, including equity and fixed income products, mutual funds, annuities, options, retirement planning, and money management services, as well as life insurance. In addition, it provides asset management services for individuals, unions and corporate retirement plans, endowments, and foundations; and private banking services for high net worth individuals, as well as Internet and telephone banking services. As of December 31, 2009, Umpqua Holdings Corporation operated 155 locations throughout Oregon, northern California, and Washington. It has a strategic alliance with Ferguson Wellman Capital Management Group for providing investment advice and asset management services. The company was founded in 1953 and is headquartered in Portland, Oregon.
CASCADE BANCORP (NASDAQ:CACB) - Cascade Bancorp operates as the holding company for Bank of the Cascades that offers a range of commercial and retail banking services. The companys deposit products include checking, money market, time deposit, and savings accounts. Its loan portfolio comprises commercial real estate loans, real estate construction and development loans, commercial and industrial loans, and residential mortgage loans, as well as consumer installment, line-of-credit, credit card, and home equity loans. Cascade Bancorp also provides investment and trust related services, cash management services, Internet banking, automated teller machines, safe deposit facilities, electronic bill payment, and remote deposit services. As of March 15, 2010, the company operated 32 full service branches in central Oregon, southern Oregon, Portland/Salem, and Boise/Treasure Valley. It serves small to medium-sized businesses, municipalities and public organizations, and professional and consumer relationships. The company was founded in 1977 and is headquartered in Bend, Oregon.
NORTH VALLEY BANCORP (NASDAQ:NOVB) - North Valley Bancorp operates as the holding company for North Valley Bank that provides commercial and retail banking services to businesses and individuals in California. The company accepts various deposit products, including demand deposits, interest bearing demand deposits, regular savings, money market deposit accounts, time deposits, and noninterest bearing deposits. Its loan portfolio comprises commercial and consumer lines of credit; installment loans; and real estate loans comprising construction and mortgage loans. The company also issues cashier's checks and money orders; and sells travelers' checks, as well as provides safe deposit boxes and other customary banking services. North Valley Bancorp offers its products and services through a network of 25 banking offices located in Shasta, Trinity, Humboldt, Del Norte, Yolo, Solano, Sonoma, Placer, and Mendocino counties. The company was founded in 1972 and is headquartered in Redding, California.
CITY NATIONAL CORP (NYSE:CYN) - City National Corporation operates as the bank holding company for City National Bank that provides a range of banking, investing, and trust services to small to mid-sized businesses, entrepreneurs, professionals, and affluent individuals. It offers deposits, such as interest checking deposits, savings deposits, demand deposits, time deposits, and certain money market accounts; and commercial loans and lease financing, residential mortgages, commercial real estate mortgages, real estate construction loans, equity lines of credit, and installment loans. The company also provides cash management, international banking, equipment financing, and other products and services. In addition, it offers investment management and advisory services, and brokerage services, including portfolio management, securities trading, and asset management; personal and business trust and investment services, including employee benefit trust services and defined benefit plans; and estate and financial planning and custodial services. The company provides proprietary and nonproprietary products to offer a range of asset classes and investment styles, including fixed-income instruments, mutual funds, domestic and international equities, and alternative investments, such as hedge funds. As of June 8, 2010, it operated 73 offices, including 17 full-service regional centers in Southern California, the San Francisco Bay area, Nevada, and New York City. The company was founded in 1953 and is headquartered in Los Angeles, California.
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