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."
Currently, OZRK trades near the top of its 52-week range.
|Name||Position||Shares Transacted||Transaction Price||Date|
|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|
Recently, 3 insiders transacted a total of 14,288 shares at an average price of $58.82.
Insider Transactions in the Last Twelve Months
|Date||Net # of Transactions||Shares Bought||Shares Sold||Net Shares Transacted||Price||Monthly Volume|
Overall, 166,288 shares were bought and 353,619 shares were sold in the last twelve months.
Current Insider Holdings
|Holder Name||Amount Held||% Shares Outstanding||Latest Chg||Filing Date|
|GLEASON II GEORGE G||3,027,736||7.60%||-50,000||2/26/2014|
|WHIPPLE ROSS M||1,158,541||2.91%||0||5/19/2014|
|ROSS MARK D||494,729||1.24%||-19,035||5/17/2013|
|FREEDBERG CATHERINE BLA||91,434||0.23%||0||2/14/2014|
|RUSSELL R DARREL||66,723||0.17%||0||2/27/2014|
|VANCE TYLER A||38,932||0.10%||0||2/14/2014|
|CISNE RICHARD L||37,325||0.09%||10,025||5/22/2014|
|MCKINNEY GREGORY L||27,070||0.07%||0||2/14/2014|
|QUALLS R L||20,200||0.05%||0||2/14/2014|
|HASTINGS JAY SCOTT||12,134||0.03%||1,509||11/4/2013|
|KYLE REX W||7,171||0.02%||1,500||11/4/2013|
|KENNY PETER C||4,300||0.01%||2,300||2/25/2014|
|PROOST ROBERT L||2,000||0.01%||0||2/14/2014|
Source: Form 4
Together, insiders hold 13.39% of the shares outstanding.
From the comparables table below, you can see that OZRK trumps its peers in terms of profitability, capital, and credit quality. As a regional bank, OZRK has a stronger balance sheet than the major banks in Bank of America (NYSE: BAC) and Citigroup (NYSE: C). Zions Bancorporation (NASDAQ: ZION), which also operates regional banks, lags OZRK in net interest spread and NPL's/Total Loans. Thus, OZRK is clearly a premium bank at a P/TV ratio of 3.85.
|In millions except per share data.|
|Fiscal Period Date||3/31/2014||3/31/2014||3/31/2014||3/31/2014||3/31/2014|
|Market Value ($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|
|Return on Equity||15.70||9.44||5.30||3.87||6.89|
|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|
|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|
|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|
|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|
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.