Insiders Are Buying Prudential Bancorp

Oct.13.13 | About: Prudential Bancorp, (PBIP)

In this article, I will feature one bank that has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.
  2. The stock is sold by no insiders in the month of intensive purchasing.
  3. At least two purchasers increase their holdings by more than 10%.

Prudential Bancorp, Inc. of Pennsylvania (NASDAQ:PBIP) operates as the bank holding company for Prudential Savings Bank that provides various financial products or services in Pennsylvania.

Insider buying during the last 30 days

Here is a table of Prudential Bancorp's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Purchased Public Offering Current Ownership Increase In Shares
Thomas Vento CEO Oct 9 8,576 Yes 77,035 shares +12.5%
Francis Mulcahy Director Oct 9 2,000 Yes 18,340 shares +12.2%
A.J. Fanelli Director Oct 9 500 Yes 14,479 shares +3.6%
Joseph Corrato EVP Oct 9 3,311 Yes 37,155 shares +9.8%
Jerome Balka Director Oct 9 1,500 Yes 21,626 shares +7.5%
Click to enlarge

There have been 15,887 shares purchased by insiders during the last 30 days.

Financials

Prudential Bancorp reported the fiscal 2013 third-quarter, which ended June 30, financial results on July 31 with the following highlights:

Revenue $3.1 million
Net income $0.7 million
Book value $6.25 per share
Tangible book value $6.25 per share
Click to enlarge

The book value increased on October 9 due to the public offering.

Competition

Prudential Bancorp's peer group consists of the following: Alliance Bancorp, Inc. of Pennsylvania (NASDAQ:ALLB), Malvern Bancorp (NASDAQ:MLVF), and Polonia Bancorp (NASDAQ:PBCP).

Here is a table comparing Prudential Bancorp to the peer group.

PBIP Peer average
Price/Earnings 38.12 N/A
Price/Book 174.40% 90.18%
Dividend yield 0% 0.74%
Click to enlarge

Prudential Bancorp has a higher P/B ratio than the peer group.

Here is a table of these competitors' insider-trading activities this year.

Company Insider buying / shares Insider selling / shares
ALLB 250 3,140
MLVF 0 0
PBCP 500 0
Click to enlarge

Only Prudential Bancorp has seen intensive insider buying during the last 30 days.

Conclusion

There have been five different insiders buying Prudential Bancorp and there have not been any insiders selling Prudential Bancorp during the last 30 days. Two of these five insiders increased their holdings by more than 10%. Prudential Bancorp has an insider ownership of 0.40%.

The insiders paid $10 for their shares at the public offering on October 9. I believe the stock could be a good pick below the $10 offering price based on the intensive insider buying.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.