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Another financial play, and another real-life holding of mine. A lot of the better investing ideas I have been finding are in the financial sector. So in real-life, I am having to make sure I don't get overweighted in Financials and Energy-related stocks, (where I am also finding a lot of attractive deals). This is another regional bank stock. (I like the regionals much better than the mega-banks, as the regionals did not tend to over-extend themselves on MBS's or other shaky investments.Their sales have grown about 9% each year for the past 2 years, and their EPS has grown about 30% annually over the past 2 years. Their profit margin has gone up in each of the past 5 years. Their earned-on-equity has gone up in each of the past 4 years. Sadly, their debt has also grown greatly over the past couple of years, so that is a worrisome trend, and one which could make me change my positive opinion on this stock. The P/E ratio is inline with recent averages, and the PEG ratio is attractive. It also pays a pretty attractive dividend yield of about 4.5%, and the dividend has been raised in each of the past 4 years. I think the stock could be worth about $44 or more in 5 years time, if it can keep up its current growth rates. Including the dividend, this would give me an annual growth of 28% for my investment, which is almost double my 15% per year goal. Hopefully, my thesis is correct.
Based in Northern New Jersey, one of the conference calls that they are in one of the wealthiest markets in the country with an average income of $81K, versus 50K for the US as a whole. Specialize in commercial loans (not construction) and multifamily dwellings. Oritani has non-performing loans of only 1.7% . Fairly cheap on book (book of $11.45). There is room for growth because their balance sheet is so good and because of a recent offering they did. Oritani was a mutual holding company thatt went 100% public in June, and raised a bunch of money doing so. Have $6/share in cash on their balance sheet. Cash gives them an equity to asset ratio is 0.26, which is a lot higher then most banks. Put that together with a good loan book and a good area to invest in, along with their history of being a traditionally conservative lender, means they should be able to grow their loan book with high quality loans.
Following Deej. See if it works!
As confidence in the recovery breaks down, equities will fall and the dollar will rise. Financials, commodities, and cyclical stocks will be the most negatively affected. P/E Ratio of 62.
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