Friday, February 7, 2014

Hot Financial Companies For 2015

Shares of Bank of America (NYSE: BAC  ) are marginally higher today as investors anxiously await the conclusion of a critical hearing in New York state court. Roughly halfway through the trading session, it's trading up by 0.22%.

There's little doubt about the significance of this case for Bank of America and its shareholders. Stemming from an $8.5 billion settlement that the bank entered into in 2011 with investors in Countrywide-issued mortgage-backed securities, a failure to attain the sought-after judicial approval will expose the nation's second largest bank by assets to an untold amount of additional liability. To date, according to The Wall Street Journal, it's already spent nearly $50 billion on legal costs tied to the financial crisis.

As a mortgage-finance litigator told Bloomberg News, "The settlement is the centerpiece of the strategy to resolving Countrywide's mortgage liability. It's imperative they get this approved or there's going to be a lot more pain down the road."

Hot Financial Companies For 2015: Ohio Valley Banc Corp.(OVBC)

Ohio Valley Banc Corp. operates as the holding company for The Ohio Valley Bank Company that provides commercial and consumer banking products and services in central and southeastern Ohio and western West Virginia. It accepts various deposit products that include checking, savings, time, and money market accounts; individual retirement accounts; and demand deposits, NOW accounts, and certificates of deposit. The company?s loan portfolio comprises residential real estate loans that include one- to four-family residential mortgages; commercial loans secured by equipment, inventory, stock, commercial real estate, and rental property; consumer loans secured by automobiles, mobile homes, recreational vehicles, and other personal property; personal loans; and floor plan and student loans. It also provides safe deposit boxes, wire transfers, credit card services, automated telephone banking systems, and Internet banking services; financial management online services, such as ca sh management and news updates related to repossession auctions, current rates, and general bank news; property and casualty insurance coverage services; and seasonal tax refund loan services. The company has 15 offices located in Ohio and West Virginia. The company was founded in 1872 and is based in Gallipolis, Ohio.

Hot Financial Companies For 2015: General Finance Corporation (GFN)

General Finance Corporation, through its subsidiaries, engages in the lease and sale of portable storage containers, portable container buildings, and freight containers. It offers mobile storage containers, including general purpose units, double pallet-wide high cube units, hazardous goods containers, and refrigerated containers; portable building containers, such as site offices and cabins, workforce accommodation units, luxury accommodation units, restroom blocks, blast-resistant units, and specialized office and infrastructure suites; and freight containers consisting of curtain-side containers, hi-cube containers, pallet-wide containers, side-opening door containers, and bulk containers. The company provides its products for various storage applications, including retail and manufacturing inventory, construction materials and equipment, documents and records, and household goods. It also leases and sells storage trailers and other storage structures, container office s, mobile offices, and modular buildings, as well as ancillary products comprising steps, furniture, portable toilets, security systems, and other items for use in connection with its equipment. In addition, the company offers delivery and installation, return and dismantle, and other site services. As of June 30, 2012, it operated a fleet of 23,855 mobile storage containers, 3,294 portable container buildings, and 9,348 freight containers. The company serves various industries, such as mining, road and rail, construction, moving and storage, manufacturing, transportation, defense, retail, utilities, education, and services sectors, as well as small and medium-size entities in New Zealand, North America, and the Asia-Pacific regions of Australia. General Finance Corporation was incorporated in 2005 and is headquartered in Pasadena, California.

Top 5 Safest Companies To Buy For 2015: Indiana Community Bancorp(INCB)

Indiana Community Bancorp operates as the holding company for Indiana Bank and Trust Company that provides consumer and commercial community banking services in Indiana. Its deposit products include savings accounts, checking accounts, certificates of deposit, NOW accounts, individual retirement accounts, health savings accounts, and commercial demand deposit accounts. The company?s loan portfolio comprises residential and commercial real estate loans; commercial loans; construction loans; and consumer loans, which consist of second mortgage and home equity loans, mobile home loans, automobile loans, loans secured by savings accounts, and other consumer loans. It also offers debit cards, credit cards, and trust services. As of April 26, 2011, the company operated 20 branch offices in central and southeastern Indiana. Indiana Community Bancorp was founded in 1908 and is based in Columbus, Indiana.

Hot Financial Companies For 2015: Capitaland Limited (C31.SI)

CapitaLand Limited, an investment holding company, engages in the real estate development, investment in real estate financial products and real estate assets, and management of serviced residences, as well as provision of advisory and management services. Its real estate and hospitality portfolio includes homes, offices, shopping malls, serviced residences, and mixed developments. The company is involved in the development and sale of residential properties; residential, commercial, and integrated property development; ownership and management of commercial and industrial properties; management of real estate funds and real estate investment trusts; and provision of financial advisory services. CapitaLand Limited operates primarily in Singapore, China, Australia, Europe, and other Asian countries. The company is headquartered in Singapore.

Hot Financial Companies For 2015: Hsbc Hdg(HSBA.L)

HSBC Holdings plc provides various banking and financial products and services. The company?s Retail Banking and Wealth Management business offers a range of personal banking products, including current and savings accounts, mortgages and personal loans, credit cards, debit cards, and local and international payment services; and wealth management services comprising insurance and investment products, and asset management and financial planning services. Its Commercial Banking business provides overdrafts, term and syndicated loans, acquisition and project finance, and asset finance; receivables finance; payments and cash management services, such as payments and collections, liquidity management, and account services; commercial cards; international trade finance; treasury and capital market products; commercial cards; insurance; and cash and derivatives in foreign exchange and rates, as well as online and direct banking services. The company?s Global Banking and Market s business offers treasury and capital markets services consisting of foreign exchange; currency, interest rate, bond, credit, equity, and other derivatives; government and non-government fixed income and money market instruments; precious metals and exchange-traded futures; equity services; capital markets instruments; securities services, which include custody and clearing services, and funds administration; and financing, advisory, and transaction services. Its Global Private Banking provides a range of private banking, investment management, trust solution, and corporate finance solutions to high net worth individuals and families. The company operates through a network of approximately 7,200 offices in 85 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East, and Africa. HSBC Holdings plc was founded in 1865 and is headquartered in London, the United Kingdom.

Hot Financial Companies For 2015: Main Street Capital Corp (MAIN.N)

Main Street Capital Corporation (MSCC) is a principal investment firm primarily focused on providing customized debt and equity financing to lower middle market (LMM) companies, which it generally define as companies with annual revenues between $10 million and $100 million that operate in diverse industries. Main Street's LMM portfolio investments principally consist of secured debt, equity warrants and direct equity investments in privately held LMM companies. Main Street's privately placed portfolio investments consist of primarily debt investments in middle market businesses that are generally larger in size than the portfolio companies within the LMM portfolio. Its LMM portfolio investments range in size from $5 million to $25 million. As of December 31, 2011, it had debt and equity investments in 54 LMM portfolio companies. On February 29, 2012, MSCC completed the exit of its debt investment and a portion of its equity investments in Drilling Info, Inc., (Drilling Info). Effective September 5, 2013, Main Street Capital Corp acquired TBT Holding Co Inc, a manufacturer of dump trailers, from Harbert Management Corp's Harbert Private Equity Fund II LLC subsidiary.

On January 5, 2012, Main Street fully exited its debt and equity investments in Currie Acquisitions, LLC (Currie). On February 17, 2012, MSCC acquired a total of approximately 8.5% of the total dollar value of the MSC II limited partnership interests not owned by MSCC. The Company has approximately 75% of its total LMM portfolio investments at cost were in the form of debt investments as of December 31, 2011. At December 31, 2011, it had equity ownership in approximately 94% of its LMM portfolio companies and the average fully diluted equity ownership in those portfolio companies was approximately 34%. Its portfolio investments are generally made through MSCC and the Funds.

Debt Investments

The Company�� LMM debt investments have term s of three to seven years, with limited required amortizati! o! n prior to maturity, and provide for monthly or quarterly payment of interest at fixed interest rates generally between 12% and 14% per annum, payable in cash. The Company also provides floating interest rates for a portion of a single tranche debt security. In addition, certain LMM debt investments may have a form of interest that is not paid but is accrued and added to the loan balance and paid at maturity. As of December 31, 2011, 93% of its LMM debt investments at cost were secured by first priority liens on the assets of LMM portfolio companies. In addition to seeking a senior lien position in the capital structure of its LMM portfolio companies, it seeks to limit the downside of its LMM investments by negotiating covenants that are designed to protect its LMM investments while affording its portfolio companies as much flexibility in managing their businesses as is reasonable.

Warrants

In connection with its LMM debt investments, the Company h as received equity warrants to establish or increase its equity interest in the LMM portfolio company. Warrants it receives in connection with a LMM debt investment typically require only a nominal cost to exercise, and thus, as a LMM portfolio company appreciates in value, it may achieve additional investment return from this equity interest. The Company structures the warrants to provide provisions protecting the rights as a minority-interest holder, as well as secured or unsecured put rights, or rights to sell such securities back to the LMM portfolio company, upon the occurrence of specified events.

Direct Equity Investments

The Company usually makes its direct equity investments in connection with debt investments. In addition, the Company may have both equity warrants and direct equity positions in some of its LMM portfolio companies. The Company makes its direct equity investments in connection with debt investments. In addition, it may have both equity warrants and direct equity positions in some! of ! its! LMM p! ortfolio companies. It seeks to maintain fully diluted equity positions in its LMM portfolio companies of 5% to 50%, and may have controlling equity interests in some instances.

Hot Financial Companies For 2015: PennyMac Mortgage Investment Trust(PMT)

PennyMac Mortgage Investment Trust is based in the United States.

Advisors' Opinion:
  • [By Sally Jones] ng>Current Shares: 3,570,000

    Value: $80,968,000

    Weighting: 19.8%

    Down 9% over 12 months, PennyMac Mortgage Investment Trust, a residential REIT, has a market cap of $1.61 billion; its shares were traded at around $22.94 with a P/E of 7.30. The dividend yield is 10%.

    PMT is not ranked for business predictability.

    Track historical data:

    Guru Action: As of Sept. 30, 2013, Kyle Bass made a new buy of 3,570,000 shares at an average price of $21.84 per share, for a gain of 4.3%.

    The GuruFocus analysis of PMT shows five warning signs.

    Vodafone Group PLC (VOD)

    Current Shares: 1,349,200

    Value: $47,465,000

    Weighting: 11.6%

    Up 55% over 12 months, Vodafone Group PLC has a market cap of $189.2 billion; its shares were traded at around $39.14 with a P/E of 273.80. The dividend yield is 4.00%.

    Vodafone Group PLC is a provider of mobile communications services and products in Germany, Italy, Spain, UK, Europe, India and Africa, Middle East and Asia Pacific.

    GuruFocus ranked VOD with one out of five stars for business predictability.

    Track historical data:

    Guru Action: As of Sept. 30, 2013, Kyle Bass made a new buy of 1,349,200 shares at an average price of $31.01 per share, for a gain of 25.9%.

    The GuruFocus analysis of VOD shows nine warning signs.

    Microsoft Corporation (MSFT)

    Current Shares: 1,500,000

    Value: $49,920,000

    Weighting: 12.2%

    Up 38% over 12 months, Microsoft Corporation has a market cap of $309.54 billion; its shares were traded at around $37.45 with a P/E of 13.70. The dividend yield is 2.60%.

    GuruFocus ranked MSFT with three out of five stars for business predictability.

    Track historical data:

    Guru Action: As of Sept. 30, 2013, Kyle Bass made a new buy of 1,500,000 shares at an average price of $32.90 per share, for a gain of 12.7%.

    The GuruFocus analysis of MSFT shows two go

Hot Financial Companies For 2015: Bank of the Carolinas Corporation(BCAR)

Bank of the Carolinas Corporation operates as the holding company for Bank of the Carolinas that provides commercial and consumer banking services to individuals and small-and medium-sized businesses primarily in the Piedmont region of North Carolina. Its deposit products portfolio includes business and individual checking accounts, savings accounts, negotiable order of withdrawal accounts, certificates of deposit, and money market checking accounts, as well as fixed interest rate certificates with varying maturities. The company?s loan products portfolio comprises consumer and commercial loans offered to individuals and small-and medium-sized businesses for various personal, business, and agricultural purposes, including term and installment loans, commercial and equity lines of credit, and overdraft checking credit; and commercial operating and working capital loans, residential mortgage loans, home equity lines of credit, other consumer loans, and loans secured by comm ercial real estate. It operates through 10 banking offices. The company was founded in 1998 and is based in Mocksville, North Carolina.

Hot Financial Companies For 2015: CNinsure Inc.(CISG)

CNinsure Inc., together with its subsidiaries, provides insurance brokerage and agency services, and insurance claims adjusting services in the People?s Republic of China. The company offers property, casualty, and life insurance products underwritten by domestic and foreign insurance companies operating in China. Its property and casualty insurance products include automobile, individual accident, commercial property, homeowner, cargo, hull, liability, and construction insurance; and life insurance products comprise individual whole life insurance, term life insurance, education annuity, and health insurance, as well as universal insurance and group life insurance. The company also offers insurance claims adjusting services, which include pre-underwriting survey, claims adjusting, disposal of residual value, loading and unloading supervision, and consulting services, as well as damage assessment, survey, authentication, and loss estimation to insurance companies and the i nsured; and value-added services to its customers in conjunction with distributing automobile insurance products. As of April 15, 2010, its distribution and service network consisted of 49 insurance agencies, 3 insurance brokerages, and 4 claims adjusting firms, with 571 sales and service outlets. The company was founded in 1998 and is headquartered in Guangzhou, the People?s Republic of China.

Advisors' Opinion:
  • [By John Udovich]

    China is set to ease the one child policy, something that could benefit Chinese stocks in general but be especially beneficial to insurance stocks like China Life Insurance Company Ltd (NYSE: LFC) and CNinsure Inc (NASDAQ: CISG) plus health care stocks like Mindray Medical International Ltd�(NYSE: MR) and Concord Medical Services Hldg Ltd (NYSE: CCM). First, let�� be clear that China is NOT abolishing the one child policy as the changes will merely�allow married couples to have two children if one spouse is an only child plus it will be up to China�� 34 province-level administrations to revise�their laws and put the new policy into effect. Moreover, China�� family-planning bureaucracy employs more than 500,000 full-time workers and six million part-time workers all the way down to the village level to�collect billions of dollars in fines and these bureaucrats have fought for years against policy changes���meaning they could throw up roadblocks if not placated. With that said, the insurance and health care sectors are two sectors with publicly Chinese stocks that look set to�take advantage of the coming changes.

Hot Financial Companies For 2015: Premafin(PRAI.MI)

Premafin Finanziaria SpA, through its subsidiary, engages in the insurance business in Italy and internationally. Its products include: car insurance, such as civil liability and auto; non-life insurance, which comprise liability, injury, illness, transportation, and individual risks; and life insurance and financial products, such as pension funds and asset management. The company also undertakes promotion and development of real estate. Premafin Finanziaria SpA is headquartered in Rome, Italy.

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