Michael SprungLaurentian BankLB.TOCOMMENTFeb 25, 2015

Prior to the recent transactions, wouldn't have touched it with a 10-foot pole. This deal is the end of the line for the bank. Doesn't expect a competing bid. The segment that was bought by NA should be accretive.

Trades at 10.5x PE, a significant discount to peers. Already up for sale, and no one bought them. If bought or merged, synergies would necessitate mass firings, which would cause political turmoil. Stuck in limbo.

Most important thing to know is that it tried to sell itself, and no one bought it. At a discount and always has been. Has to compete with the big banks, which keep getting bigger.

A small bank, so he wouldn't be surprised if this were taken over one day. Nothing wrong with this. You'd hope that the new management would improve efficiencies and lower operating costs.

Still avoid. Lower valuation than the rest of the banking sector. Bigger issue of something wrong is that they put themselves up for sale, but there were no takers. 

Stay away. Very low valuation, which attracts some people. Doesn't have scale or diversified product offering. Harder for smaller banks to made adequate investment in technology, which limits returns. He'd rather one of the big 6, such as TD or BNS.

LB traded sideways for the past year, with a nice level of support around $24, and after its recent earnings it popped higher to $30. To help confirm an uptrend, we would like to see it rise above $32. We do not see any news regarding a potential sale, but it trades at a decent valuation of 9.5X forward earnings, and some major banks raised their price targets on the name following its recent results. Given the negative momentum and slow growth, we would prefer assessing this one from the sidelines.
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(Note the short timeframe.)
His target was $31, and it hit that. He got about 60% of his holding offloaded at that level. His only bank with about a 1% position. Holding for the nice dividend, expecting an eventual bounce off $28 level.

Bought in his conservative strategy when all the analysts on the street hated it. Stock has a definite bottom, and he bought near that for a swing trade. Now at, or near, the top. His target was $31 -- obtained, as that was the level of support in late 2022 and mid-2023. Today it's around $29.50, so he's on the verge of selling.
 
Could move a bit higher, as the banks tend to move as a group until the end of December. Might get another $1 out of it. "Bulls make money, bears make money, pigs get slaughtered." Once it hits $31, he's out.

Excellent trend. Likes setup of the chart - would recommend buying at this price. Seeing value in the current share price. Bank appears to be a M&A candidate, or a turnaround story. Support appears to be there for a recovery. A stop loss strategy could also protect investors. 

Doesn't have a bright outlook for its future. Not a good bank. Multi-decade series of strategic blunders. Increasingly, scale matters, and this one is sub-scale. Put themselves up for sale, but why would anyone buy it when they can just eat their lunch for free and take their market share?

Different from NA takeover of CWB; both of those banks are good banks.

Don't buy today, but you can continue to own it if you already do. Pretty nice dividend yield, safe payout ratio. Trap. Not a lot of great opportunity. Needs improved growth, better operational efficiency, more consistent revenues.

He made that call right before they put themselves for sale. So it would have been a good time to sell. He's baffled why BNS bought CWB and not the cheaper LB. He would hang onto this. It's so cheap and eventually somebody will buy it.

Tough one. Up for sale, no offers accepted. Power outage. Management changes. Very low ROE compared to peers. Still thinks it will get gobbled up. Results on slow decline, need to turn ship around.

Would not recommend buying bank. Broken business model. Cheap business for a reason. Sub scale in terms assets. Very behind in competitive nature of business. Dividend yield tempting - but is too risky to justify investment. Cutting dividend very poor sign.