Profit Fan

Profit Fan
Contributor since: 2013
Sold some $17.5 Jan-17 Puts for $4
Thank you Adrian, ever look at CAC?
Thank you Loonsong, let us know what you think.
Nice call on CATC, I also added some here.
Have you looked at CAC? I'm working on an article that should be out soon - looks attractive after the pullback.
Good luck to you too!
Thank you I really appreciate that! Hope you have a great weekend.
I really enjoy a number based thesis so thank you for putting this together. Just wondering, are you actually holding a short position in the bank or are you just short in the sense that you think shares are overvalued? Thanks again.
Thank you WD. Just to be clear though, I'm not long and only think shares are attractive based on past valuation trends (ones calculated in the article). This indicates a reversion play may be available, but alone this thinking is missing a more important discussion on growth potential and peer valuations (which I will cover after the 10Ks are filed). As I said in the article, 'I consider the analysis below as a basic starting point.' Thanks again, I now have your articles on my 'to read' list.
Thank you zucks, and I hope you find the updates useful - I'll spend more time there thinking through the results of the calculations, and less on the calculations/methodology.
BAC's leverage ratios are high. I will probably add this line in the future but assets / allocated or adjusted capital is greater than most other large banks - which typically means more earnings are needed to support assets, and less is available to payout. The EVA calculation above was negative before we adjusted out litigation, suggesting even the current low payout was from capital and not earnings.
Thank you Cap, litigation expense and a low percentage of allocated capital / market cap = major uphill earnings battle.
Thank you OC, I actually had an article last year that discussed share count and the damper you highlight.
Thank you WPP, this is meant to be a tool and that wouldn't be a hard line to add going forward, so consider it done. If you have any other ideas/thoughts please share. Thanks again.
Will do, thanks!
I had to google Sinonyx. And interestingly, it appears new research has the animal linked to a hippopotamus and not a whale. Good to know investors aren't the only ones having trouble analyzing 'straight' lines. Thanks for the article.
Morphologists have long thought that Sinonyx was the direct ancestor of Cetacea (whales and dolphins), but the discovery of well preserved hind limbs of archaic cetaceans as well as more recent DNA phylogenetic analyses[3][4][5] now indicates that cetaceans are more closely related to hippopotamids and other artiodactyls than they are to mesonychids, and this result is consistent with many molecular studies
Hello Adrian I did and picked up a few shares - very few but will be slowly adding. A lot of options now but I share your concern so haven't been too active. Ever look at DPM? They have a lot of support from PSX.
I took a look at GBX a few months ago but am not too familiar. Love the buyback and it does seem to be really cheap. I'm not sure where oil goes, or takes GBX, but if you want more shares selling puts right now is an attractive option. A lot of good buys related to oil but I see nothing to support the current price even at below $40 WTI (due to demand / oncoming supply) - where's that crystal ball?
Thank you Alexander happy holidays! As a formality, I'm not a professional adviser of any type.
I was able to grab some in the low $80's earlier in the year via limit orders. Wish I would have bought a few more shares then, but today's price is still low. As a general rule, I don't like to pay more than 10X pre-tax, and shares are much less than 10X after-tax right now (and earnings are growing). Still a good deal, and a bonus here is the large allowance account that is also depressing book value. Only downside is the little attention the bank is getting, but at the same time this is the reason shares are available for a cheap price.
As far as being patient, first step is probably to decide how large you want to be in on one company. Then, just jot down what you want in a small bank and compare your choices to EXSR, or any other company you want to accumulate. 
Thank you Loonsong happy new year!
PS: I can't believe I found one
PS2: 5000...You and Adrian make me want to take a closer look.
I'm personally slowly adding a small amount every other month until I get to 2-3% of my portfolio. I'm looking long-term and think this can continue to appreciate as more assets are brought on. The bank is adding a lot of value.
Hello lowdawg, I wasn't able to find the exact amount but ~30% of the portfolio is in construction (~5%) and non-real estate C+I (~25). Even so, the majority of the portfolio is concentrated in western Pen. so I imagine energy pricing is putting pressure on everything, to some degree, and that it is likely to continue short-medium term. Just my own thoughts.
Good to hear from you Adrian, I hope you are having a great holiday season.
I'm patiently waiting on EXSR and do have a starter position in CATC (need to put together updates on both). EXSR is slow-moving but it's hard to be unhappy with the progress considering how much their earnings have grown. Thanks again for the tips. Happy New year.
Considering most banks sell for 12-15% of assets that would provide some short-term upside for investors. I personally look for more to gain from a better long-term story; if you follow my articles you will notice I shy away from general acquisition statements like this.
Thanks for your comment Rick, few people seem to be worried about interest rate risk, I'm not one of them.
In this case, I think the duration is consistent with the bank's liabilities. Because of this, there may be an opportunity to buy the bank at a lower book value (after OCI adjustments), but I don't see these unrealized losses materializing because of the bank's liquidity. That said, the debt portfolio shouldn't be expected to help out with NIMs, but from my perspective the cashflows match-up fairly consistently, and should save the bank from realizing any losses on the portfolio. 
Thank you pgace123, hopefully we can get a couple more years of growth before that.
Thank you loonsong, you always remind me I need to do a better job connecting dots on the major holders. I appreciate your insight.
Never, but compared to other banks with excess capital, this one has a strong core probable of creating positive EVA - which was why I spent some time outlining how I think returns will increase overtime.
Thank you rafcaf.
I don't think they are either, which is why the 'misleading headline' was 'said dividend won't last forever.'
Thank you MathRulz.
Philipsonh, when you say 'I' do you mean you and Bingbird? Sorry for any confusion, sounds like you're squared away but if you had any other questions just let me know.
Thank you Joe, I think the offloading outweighs the negative by a wide margin. As I mentioned in the article, the bank right now has close to $1 billion more than they need, and this number grows as deposits are added.
I knew someone would eventually call me out on that.
Thank you Loonsong
With a strong bank a long-term holding period, like you seem to be employing, is definitely the way to go. My play was for a quick spin this time and I would have moved the investment to the long-term bucket, but it was already full with what I consider to be better prospects. Thanks for sharing your experience with the bank, good luck.