CATY Stock Intrinsic Value – Cathay General Bancorp EVP Sells 900 Shares in Company Transaction
November 7, 2024
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Cathay General Bancorp ($NASDAQ:CATY) is a bank holding company based in Los Angeles, California. It operates through its subsidiary, Cathay Bank, which offers a wide range of financial services to individuals and businesses. On Wednesday, news broke that the company’s Executive Vice President, Thomas M. Lo, sold 900 shares of Cathay General Bancorp’s stock in a transaction. This insider selling by a high-ranking executive may raise some concerns among investors. After all, if an EVP is selling their shares in the company, it could be interpreted as a lack of confidence in the company’s future performance.
However, it is important to note that insider selling is not always a negative sign. Executives often sell shares for various reasons, such as diversifying their portfolio or meeting personal financial goals. In fact, Cathay General Bancorp’s stock has been performing well in recent months. Moreover, Lo’s sale of 900 shares is only a small portion of his overall holdings in the company. This could suggest that he still holds confidence in Cathay General Bancorp’s future prospects and was simply taking advantage of a favorable market opportunity. In conclusion, while the news of Cathay General Bancorp’s EVP selling 900 shares may initially cause some concern, it is important for investors to look at the bigger picture. The company’s solid financial performance and the small percentage of shares sold by Lo indicate that this may not necessarily be a negative signal. As always, it is wise for investors to conduct thorough research and consider all factors before making any investment decisions.
Price History
This news caused a slight decline in the stock price, as the company’s stock opened at $46.37 and closed at $45.93, representing a decrease of 0.11% from the previous day’s closing price of $45.98. The sale of 900 shares by an Executive Vice President may raise some questions for investors.
However, it is important to note that this transaction is within the scope of insider trading regulations and was likely done for personal financial planning purposes. It is not uncommon for executives to sell shares in their company as a means of diversifying their investment portfolio. Despite this recent transaction, CATHAY GENERAL BANCORP has been performing well in the stock market. This indicates investor confidence in the company’s financial health and potential for future growth. The company has a strong presence in the Asian-American community and continues to expand its reach in other diverse communities as well. In addition to its strong financial performance, CATHAY GENERAL BANCORP has also been recognized for its commitment to corporate social responsibility. The company has been named one of the “Best Banks in America” by Forbes and has received numerous awards for its diversity and inclusion efforts. In conclusion, while the recent sale of 900 shares by an Executive Vice President may have caused a slight dip in CATHAY GENERAL BANCORP’s stock price, the company remains a strong and reputable player in the financial industry. With a history of consistent growth and a commitment to diversity and social responsibility, it is likely that investors will continue to have confidence in the company’s future performance. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for CATY. More…
| Total Revenues | Net Income | Net Margin |
| – | 354.12 | – |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for CATY. More…
| Operations | Investing | Financing |
| 467.39 | -1.85k | 94.74 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for CATY. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 23.08k | 20.34k | – |
Key Ratios Snapshot
Some of the financial key ratios for CATY are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.8% | – | – |
| FCF Margin | ROE | ROA |
| – | – | – |
Analysis – CATY Stock Intrinsic Value
As a financial analyst, I have taken a deep dive into the financials of CATHAY GENERAL BANCORP. After thorough analysis, I have determined that the fair value of their shares is approximately $46.4. This valuation has been calculated using our proprietary Valuation Line, which takes into account various financial metrics such as earnings, cash flow, and book value. Currently, CATHAY GENERAL BANCORP’s stock is trading at $45.93, which means it is slightly undervalued by about 1.1%. This presents an opportunity for investors to purchase the stock at a fair price and potentially see a return on their investment in the future. It is worth noting that the banking industry has been facing challenges in recent years, with low interest rates and increasing competition. Their revenue and net income have steadily increased over the past five years, and they have a strong balance sheet with healthy levels of liquidity and capital. In addition, CATHAY GENERAL BANCORP has a solid track record of dividend payments, which is attractive for investors looking for a steady stream of income. They also have a healthy return on equity (ROE) and return on assets (ROA), indicating efficient use of capital and assets. While there may be some risks associated with investing in the banking industry, such as regulatory changes and economic downturns, overall CATHAY GENERAL BANCORP appears to be a stable and promising investment option. With their strong financials and undervalued stock price, I believe that this company has the potential to provide solid returns for investors in the long run. More…
Peers
The company’s principal subsidiary is Cathay Bank, which provides commercial banking products and services in the United States. The company’s other subsidiaries include Cathay Investment Ltd., Cathay Insurance Agency, Inc., and Cathay Properties, Inc. The company operates through its branches in California, New York, Texas, Illinois, Washington, Massachusetts, Nevada, and Hong Kong. The company’s competitors include Oak Valley Bancorp, Cornerstone Community Bancorp, University Bancorp Inc.
– Oak Valley Bancorp ($NASDAQ:OVLY)
Oak Valley Bancorp is a bank holding company based in Oakdale, California. It operates through its subsidiary, Oak Valley Community Bank, which provides banking services to retail and commercial customers in California’s San Joaquin Valley. As of December 31, 2020, Oak Valley Bancorp had total assets of $2.3 billion and total deposits of $1.9 billion.
– Cornerstone Community Bancorp ($OTCPK:CRSB)
The market cap for University Bancorp Inc. is $83.37 million as of 2022. The company is a holding company for University Bank, which is a full-service bank that offers personal and commercial banking products and services in the United States.
Summary
CATHAY GENERAL BANCORP’s EVP, Thomas M. Lo, recently sold 900 shares of the company’s stock. This could indicate a lack of confidence in the company’s future performance, as executives typically only sell shares for personal reasons or if they believe the stock is overvalued. Additionally, CATHAY GENERAL BANCORP’s stock has been performing below average compared to its industry peers, potentially raising concerns for investors.
However, it’s important to conduct further research and analysis before making any investment decisions. Factors such as the company’s financials, market conditions, and future growth potential should all be taken into consideration when evaluating an investment in CATHAY GENERAL BANCORP.
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