Mechanics Bancorp (NASDAQ:MCHB) Hits New 12-Month High - Should You Buy?

Key Points

• Mechanics Bancorp reached a new 52-week high, trading as high as $17.21 and up 2.8%; its average analyst rating is “Moderate Buy” with a $17.12 target price.
• The company raised its quarterly dividend to $0.70 per share, implying a $2.80 annualized payout and a 16.3% yield. However, its 227.64% payout ratio may raise questions about dividend sustainability.
• Institutional investors own approximately 74.71% of outstanding shares, with several funds recently initiating or increasing positions in the stock.

Mechanics Bancorp (NASDAQ:MCHB - Get Free Report) hit a new 52-week high during trading on Tuesday . The stock traded as high as $17.21 and last traded at $17.17, with a volume of 394573 shares trading hands. The stock had previously closed at $16.71.

Wall Street Analysts Forecast Growth

Several analysts have issued reports on MCHB shares. Zacks Research upgraded Mechanics Bancorp to a "hold" rating in a report on Monday, June 1st. Weiss Ratings downgraded shares of Mechanics Bancorp from a "buy (b)" rating to a "buy (b-)" rating in a research report on Thursday, July 23rd. Stifel Nicolaus set a $17.00 price target on shares of Mechanics Bancorp in a report on Thursday, May 28th. Raymond James Financial initiated coverage on shares of Mechanics Bancorp in a research note on Thursday, May 28th. They issued an "outperform" rating and a $17.00 price objective for the company. Finally, Keefe, Bruyette & Woods increased their target price on Mechanics Bancorp from $16.00 to $17.50 and gave the company a "market perform" rating in a report on Wednesday, August 5th. Three investment analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the stock. According to MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of $17.12.

Mechanics Bancorp Trading Up 2.8%

The company has a current ratio of 0.80, a quick ratio of 0.80 and a debt-to-equity ratio of 0.05. The company has a market cap of $3.80 billion, a PE ratio of 13.96 and a beta of 1.41. The business's 50-day simple moving average is $15.79 and its 200-day simple moving average is $15.20.

Mechanics Bancorp Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Thursday, May 28th. Investors of record on Saturday, May 23rd were issued a dividend of $0.70 per share. This is a positive change from Mechanics Bancorp's previous quarterly dividend of $0.40. This represents a $2.80 annualized dividend and a dividend yield of 16.3%. The ex-dividend date was Friday, May 22nd. Mechanics Bancorp's dividend payout ratio is 227.64%.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of MCHB. Gator Capital Management LLC raised its stake in shares of Mechanics Bancorp by 0.8% during the 4th quarter. Gator Capital Management LLC now owns 245,001 shares of the company's stock worth $3,584,000 after purchasing an additional 1,865 shares in the last quarter. Comerica Bank bought a new stake in shares of Mechanics Bancorp in the 3rd quarter valued at approximately $34,000. California State Teachers Retirement System acquired a new position in Mechanics Bancorp in the first quarter worth approximately $39,000. Fifth Third Bancorp bought a new position in Mechanics Bancorp during the first quarter valued at approximately $39,000. Finally, Assetmark Inc. acquired a new stake in Mechanics Bancorp in the first quarter valued at approximately $51,000. Hedge funds and other institutional investors own 74.71% of the company's stock.

About Mechanics Bancorp

HomeStreet, Inc operates as the bank holding company for HomeStreet Bank that provides commercial, mortgage, and consumer/retail banking services primarily in the Western United States. The company offers personal and business checking, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit; credit cards; insurance; and treasury management products and services. Its loan products include commercial business and agriculture loans, single family residential mortgages, consumer loans, commercial loans secured by residential and commercial real estate, and construction loans for residential and commercial real estate development, as well as consumer installment loans and permanent loans on commercial real estate and single-family residences.

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