Exaggeration and manipulation plagues diligent stock investing. Learning to read between the lines, and to discount ambitious future projections, are non-productive but essential skills for participating in any stock exchange format. That is why investors should consider greeting this holding bank’s 2007 business results and management statements, by supporting the stock.
The President, who is also the CEO, is modest about some outstanding business achievements by the entire management team. The operating bank has no sub-prime transactions. Non-performing loans are well below 1% of all advances. The operating bank has expanded business in commercial real estate, while reducing interests in new construction activities. These are precisely the kind of management moves that the Mojave county local business environment needed in 2007.
Banking is a business area where a conservative approach pays. This management considers each loan application on merits, and has a sound approach to risk management. Investors should value the stock in this light, rather than in conventional terms of numbers alone.
Conservatism has not prevented the management from taking bold business initiatives. It has started a Small Business Unit, which has excellent prospects to take advantage of the Presidential stimulus package for the US economy. Small business development is also especially suited for the Mojave county commercial environment.
The management has invested in information technology and new recruitment during 2007. Financial results could have looked better with window dressings of outsourcing, but investors will appreciate the growth and profit potentials during 2008, as well as the long term approach of the management through the difficult business climate of 2007.
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