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Using the Forecaster Model In 2006, geography was destiny - and the metrics were misleading. It was a winning strategy to 'avoid' California and Oregon and 'buy' Texas and Oklahoma. The stocks that the analyst liked did not out-'total return' the stocks the analysts did not like. The low yielders failed to out-return the high yielders. Nor was buying the high P/E stocks or high Price/Book stocks a winning strategy. In a sector where the dividend payout ratio varies from 21% to 80%, it is not a surprise that the dividend discount model fails to be predictive. This sector sells at a fairly consistent P/E ratios despite wide variations in CAGRs. That is not logical. And the CAGRs also fail to be predictive of the stocks with high price to book ratios. That is not logical. I am not giving up hope that this sector can be forecasted. But my readers should be pessimestic about the predictions in the forecaster spreadsheet until it shows more signs of some success. This is the link to the 2006 stats for this sector, showing the projections based on 2006 begining of the year stats - along with the 2006 returns in the 'forecasting' spreadsheet which is the last of five spreadsheet posted - or roughly in the middle of the long page. CNB to Buy Back Stock AP 6-11 Colonial BancGroup Inc. said Monday its board approved a new stock buyback program, authorizing the repurchase of up to $150 million common shares. The company said it will make purchases from time to time on the open market or in privately negotiated transactions. The plan will terminate upon completion or June 8, 2009, whichever is earlier. The company currently has about 153 million common shares outstanding. Ratings & Dividend Changes On 6-22 Bear Stearns Intiated coverage of ZION at Peer Perform and CNB at Outperform. On 6-22 Bear Stearns Initiated coverage of ZION at Peer Perform. On 6-26 Stifel Nicolaus Initiated coverage of FHN at Hold and ZION at Buy. On 6-29 JP Morgan Initiated coverage of PRSP at Neutral. On 6-12 analysts at Morgan Keegan maintained their "outperform" rating on CNB. In a research note published this morning, the analysts mention that the current valuation of the company’s stock does not appropriately reflect value creation in its franchise and improving fundamentals. The consensus EPS projections for Colonial BancGroup do not reflect the potential earnings and revenue upside related to market dislocations and are extremely low, in view of the higher visibility into CNB's EPS guidance, the analysts say. On 5-04 AG Edwards Initiated CYN at Hold. On 5-18 Analyst Richard X Bove of Punk Ziegel & Co maintained his "market perform" rating on ZION with a target price of $87.00. In a research note, the analyst mentions that the company is facing a period of weak unit growth at stressed margins. The southwestern construction markets have been facing problems in commercial and residential construction, leading to deteriorating loan quality in these areas, the analyst says. Zions Bancorporation may also witness loan losses on account of rising unemployment. On 5-24 UB raised its quarterly dividend to 52 cents per share. Home Page Factoids Previous Update |