3 Insiders Are Buying Bank Of The Ozarks Stock

Jun.19.14 | About: Bank of (OZRK)

Summary

Recently, 3 insiders transacted a total of 14,288 shares at an average price of $58.82.

Overall, 166,288 shares were bought and 353,619 shares were sold in the last twelve months.

Together, insiders hold 13.39% of the shares outstanding.

According to management, Bank of the Ozarks "provides a wide range of retail and commercial banking services. Deposit services include checking, savings, money market, time deposit and individual retirement accounts. Loan services include various types of real estate, consumer, commercial, industrial and agricultural loans and various leasing services. The Company also provides mortgage

lending; treasury management services for businesses, individuals and non-profit and governmental entities including wholesale lock box services; remote deposit capture services; trust and wealth management services for businesses, individuals and non-profit and governmental entities including financial planning, money management, custodial services and corporate trust services; real estate appraisals; credit-related life and disability insurance; ATMs; telephone banking; online and mobile banking services including electronic bill pay; debit cards, gift cards and safe deposit boxes, among other products and services. Through third party providers, the Company offers credit cards for consumers and businesses, processing of merchant debit and credit card transactions, and full-service investment brokerage services. While the Company provides a wide variety of retail and commercial banking services, it operates in only one segment. No revenues are derived from foreign countries and no single external customer comprises more than 10% of the Company's revenues."

History

OZRK Chart

OZRK data by YCharts

Currently, OZRK trades near the top of its 52-week range.

Recent Transactions

Name Position Shares Transacted Transaction Price Date
AREHART JEAN Director 1,000 $62.80 6/13/2014
AREHART JEAN Director 1,000 $62.94 6/13/2014
CISNE RICHARD L Director 2,025 $58.37 5/22/2014
CISNE RICHARD L Director 1,325 $58.49 5/22/2014
CISNE RICHARD L Director 2,825 $58.30 5/22/2014
CISNE RICHARD L Director 3,400 $58.30 5/22/2014
CISNE RICHARD L Director 450 $58.25 5/22/2014
REYNOLDS JOHN Director 2,000 $57.41 5/20/2014
REYNOLDS JOHN Director 263 $56.89 5/20/2014
Click to enlarge

Recently, 3 insiders transacted a total of 14,288 shares at an average price of $58.82.

Insider Transactions in the Last Twelve Months

Date Net # of Transactions Shares Bought Shares Sold Net Shares Transacted Price Monthly Volume
Jun-14 1 2,000 -8,000 -6,000 $64.87 2,605,000
May-14 7 12,288   12,288 $59.04 4,346,000
Apr-14         $59.90 4,877,000
Mar-14 1 1,600   1,600 $68.06 4,838,000
Feb-14 -3 43,900 -95,324 -51,424 $63.42 3,912,000
Jan-14 6 12,000   12,000 $63.40 4,805,000
Dec-13 -1   -524 -524 $56.59 3,434,000
Nov-13 4 73,700 -107,400 -33,700 $56.15 2,629,000
Oct-13 -8 14,800 -38,071 -23,271 $49.48 3,715,000
Sep-13 -2   -98,300 -98,300 $47.94 2,646,000
Aug-13   6,000 -6,000   $45.38 1,962,000
Jul-13         $47.78 3,986,000
Click to enlarge

Overall, 166,288 shares were bought and 353,619 shares were sold in the last twelve months.

Current Insider Holdings

Holder Name Amount Held % Shares Outstanding Latest Chg Filing Date
GLEASON II GEORGE G 3,027,736 7.60% -50,000 2/26/2014
WHIPPLE ROSS M 1,158,541 2.91% 0 5/19/2014
ROSS MARK D 494,729 1.24% -19,035 5/17/2013
FREEDBERG CATHERINE BLA 91,434 0.23% 0 2/14/2014
GLEASON LINDA 78,816 0.20% 0 2/26/2014
SMITH KENNITH 73,265 0.18% 0 2/28/2013
RUSSELL R DARREL 66,723 0.17% 0 2/27/2014
EAST ROBERT 66,300 0.17% 0 2/14/2014
MARIANI HENRY 55,000 0.14% -8,000 6/5/2014
VANCE TYLER A 38,932 0.10% 0 2/14/2014
CISNE RICHARD L 37,325 0.09% 10,025 5/22/2014
THOMAS DAN 28,288 0.07% 0 2/14/2014
MCKINNEY GREGORY L 27,070 0.07% 0 2/14/2014
QUALLS R L 20,200 0.05% 0 2/14/2014
AREHART JEAN 18,236 0.05% 2,000 6/13/2014
HASTINGS JAY SCOTT 12,134 0.03% 1,509 11/4/2013
HOLMAN GENE 8,770 0.02% 1,500 11/4/2013
REYNOLDS JOHN 8,418 0.02% 2,263 5/20/2014
KYLE REX W 7,171 0.02% 1,500 11/4/2013
KENNY PETER C 4,300 0.01% 2,300 2/25/2014
BROWN NICHOLAS 2,300 0.01% 1,600 3/3/2014
PROOST ROBERT L 2,000 0.01% 0 2/14/2014
WEST-SCANTLEBURY SHERE 28 0.00% 0 2/14/2014
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Source: Form 4

Together, insiders hold 13.39% of the shares outstanding.

From the comparables table below, you can see that OZRK trumps its peers in terms of profitability, capital, and credit quality. As a regional bank, OZRK has a stronger balance sheet than the major banks in Bank of America (NYSE: BAC) and Citigroup (NYSE: C). Zions Bancorporation (NASDAQ: ZION), which also operates regional banks, lags OZRK in net interest spread and NPL's/Total Loans. Thus, OZRK is clearly a premium bank at a P/TV ratio of 3.85.

Comparables Table

In millions except per share data.          
Ticker (NASDAQ:OZRK) (NYSE:BBT) (NASDAQ:) (NYSE:) (NYSE:)
Fiscal Period Date 3/31/2014 3/31/2014 3/31/2014 3/31/2014 3/31/2014
Market Value ($M) 2,606.0 27,917.2 5,507.1 164,570.1 145,601.8
Price/ Tangible Book 3.82 2.08 1.21 1.15 0.85
Return on Assets 2.06 1.08 0.46 0.45 0.73
Annualized ROA 2.10 1.18 0.73 -0.05 0.84
Return on Equity 15.70 9.44 5.30 3.87 6.89
Annualized ROE 15.82 9.81 5.52 -0.94 7.66
Net Interest Margin (%) 5.63 3.58 3.30 2.51 2.74
Annualized Net Interest Margin (%) 5.39 3.49 3.26 2.28 2.83
Net Interest Spread (%) 5.28 3.31 2.94 2.29 2.66
Tier 1 Risk-Based Capital Ratio (%) 15.20 12.10 13.19 11.90 11.10
Total Risk-Based Capital Ratio (%) 16.16 14.60 15.11 14.80 12.30
Leverage Ratio (%) 14.41 9.50 10.71 7.40 5.60
Tier 1 Common Equity Ratio (%) - 10.20 10.56 11.80 14.59
Common Equity/ Total Assets (%) 12.99 11.26 9.95 10.17 10.62
Assets/ Equity 7.66 7.84 8.51 9.27 9.01
Avg Equity/ Avg Assets (%) 13.10 10.75 9.65 10.11 10.37
Book Value per Share 17.68 28.93 30.19 20.75 66.25
Price/ Book Value per Share 3.85 1.39 1.03 0.83 0.72
Tangible Book Value per Share 17.11 18.67 24.53 13.61 56.40
Tangible Common Equity 632 13,417 4,535 143,357 171,345
Tangible Common Equity Ratio (%) 12.62 7.57 8.24 6.91 9.19
Tang Com Equity/ Risk-Wtd Assets (%) 13.89 9.70 10.24 11.18 15.46
Total Risk Based Capital 736 20,154 6,687 190,124 191,651
Risk-Weighted Assets 4,552 138,375 44,267 1,282,117 1,108,011
T12M Net Chg Offs/ Avg Tot Loans 0.17 0.56 0.11 0.73 1.47
Annualized Net Chg-Offs/ Avg Tot Loans 0.05 0.55 0.08 0.60 1.48
Prov Loan Losses/ Total Loans (%) 0.04 0.05 -0.00 0.11 0.27
Provision for Loan Losses 1 60 -1 1,009 1,793
Actual Loan Losses (Net Chg-Offs) 0 159 8 1,388 2,439
T12M Actual Loan Losses (Net Chg-Offs) 5 662 42 6,768 10,024
Actual Loan Losses/ Provisions (%) 29.75 265.00 -1,311.48 137.56 -
Loan Loss Coverage 90.98 5.38 19.59 0.24 3.20
Reserve for Loan Losses 44 1,642 737 16,618 18,923
Rsrv for Loan Losses/ Tot Loans (%) 1.23 1.40 1.87 1.79 2.72
Loan Loss Res/ NPA's (BPS) 151.98 166.53 167.11 93.72 210.21
NPL's 12 903 402 17,109 8,593
NPA's 29 986 441 17,732 9,002
NPA's/ Total Assets (%) 0.57 0.53 0.79 0.82 0.48
NPA's/ Total Loans(%) 0.81 0.84 1.12 1.91 1.29
NPL's/ Total Loans 0.33 0.77 1.02 1.84 1.23
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Conclusions

Given the terrific metrics in profitability, capital, and credit quality, Ozarks is a premium bank that could be bought long. The recent insider purchases only bolsters this view. Furthermore, Ozarks has raised its dividend every quarter for the last 15 quarters and currently yields 1.4%. The bank relies on acquisition of undervalued assets, and the financial crisis had brought on plenty of such opportunities.

Despite the exciting growth opportunities, the bank trades at a high TBV multiple. Thus, investors could find great entry points when a sell-off of fast growers develops.

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