Preferred Bank (NASDAQ:PFBC) Sees Strong Trading Volume - Should You Buy?

Key Points

• Q1 EPS beat — Preferred Bank reported EPS of $2.53 vs. $2.48 expected while revenue missed ($69.62M vs. $71.76M); the bank shows strong profitability (ROE 17.52%, net margin 26.49%) and analysts expect roughly 10.58 EPS for the year.
• Analyst outlook is mixed with a MarketBeat consensus of "Hold" and an average target of $102; Piper Sandler raised its target to $111 while ratings range from Buy to Hold across firms.
• Preferred Bank pays a quarterly dividend of $0.80 (annualized $3.20, yield ~3.4%, payout ratio ~30%), and institutional investors own about 72.77% of the shares, with several large funds recently increasing positions.

Shares of Preferred Bank (NASDAQ:PFBC - Get Free Report) saw strong trading volume on Monday . 83,987 shares were traded during mid-day trading, a decline of 20% from the previous session's volume of 104,353 shares.The stock last traded at $94.8650 and had previously closed at $95.47.

Analysts Set New Price Targets

A number of analysts have recently commented on the stock. Stephens reissued a "positive" rating on shares of Preferred Bank in a research report on Monday, January 26th. Piper Sandler lifted their target price on Preferred Bank from $105.00 to $111.00 and gave the company an "overweight" rating in a research report on Monday, April 27th. Brean Capital downgraded Preferred Bank from a "strong-buy" rating to a "hold" rating in a research report on Tuesday, February 24th. Finally, Janney Montgomery Scott started coverage on Preferred Bank in a research report on Tuesday, February 24th. They issued a "neutral" rating and a $100.00 target price on the stock. Three analysts have rated the stock with a Buy rating and four have assigned a Hold rating to the company's stock. Based on data from MarketBeat.com, the stock has a consensus rating of "Hold" and an average target price of $102.00.

Preferred Bank Trading Down 0.7%

The company has a debt-to-equity ratio of 0.45, a current ratio of 1.07 and a quick ratio of 1.06. The business has a 50-day moving average of $91.34 and a 200-day moving average of $92.51. The firm has a market cap of $1.37 billion, a price-to-earnings ratio of 8.89 and a beta of 0.56.

Preferred Bank (NASDAQ:PFBC - Get Free Report) last released its earnings results on Wednesday, April 22nd. The bank reported $2.53 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.48 by $0.05. The business had revenue of $69.62 million for the quarter, compared to the consensus estimate of $71.76 million. Preferred Bank had a return on equity of 17.52% and a net margin of 26.49%. Research analysts anticipate that Preferred Bank will post 10.58 EPS for the current year.

Preferred Bank Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Tuesday, April 21st. Investors of record on Tuesday, April 7th were issued a dividend of $0.80 per share. The ex-dividend date was Tuesday, April 7th. This represents a $3.20 dividend on an annualized basis and a yield of 3.4%. Preferred Bank's dividend payout ratio (DPR) is presently 29.96%.

Hedge Funds Weigh In On Preferred Bank

A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Charles Schwab Investment Management Inc. grew its holdings in Preferred Bank by 3.4% during the fourth quarter. Charles Schwab Investment Management Inc. now owns 494,827 shares of the bank's stock worth $46,727,000 after purchasing an additional 16,348 shares during the period. Nuveen LLC grew its holdings in Preferred Bank by 5.4% during the fourth quarter. Nuveen LLC now owns 356,065 shares of the bank's stock worth $33,623,000 after purchasing an additional 18,309 shares during the period. American Century Companies Inc. grew its holdings in Preferred Bank by 15.7% during the third quarter. American Century Companies Inc. now owns 337,804 shares of the bank's stock worth $30,534,000 after purchasing an additional 45,946 shares during the period. Goldman Sachs Group Inc. grew its holdings in Preferred Bank by 19.1% during the fourth quarter. Goldman Sachs Group Inc. now owns 206,622 shares of the bank's stock worth $19,511,000 after purchasing an additional 33,124 shares during the period. Finally, Kennedy Capital Management LLC grew its holdings in Preferred Bank by 19.9% during the fourth quarter. Kennedy Capital Management LLC now owns 199,419 shares of the bank's stock worth $18,831,000 after purchasing an additional 33,157 shares during the period. Institutional investors own 72.77% of the company's stock.

About Preferred Bank

Preferred Bank NASDAQ: PFBC is a California-chartered commercial bank headquartered in Los Angeles. The institution offers a full range of banking products and services to businesses and individuals, with a particular emphasis on commercial real estate lending, business banking, treasury management and deposit accounts. Preferred Bank operates through branch offices across Southern California and national loan production offices in major U.S. markets.

The bank's core lending portfolio focuses on commercial real estate acquisition, development and investment properties.

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