This bank is joining the digital asset (think Bitcoin) business rapidly, boosting its attractiveness to investors.
Signature Bank (SBNY)
From Skousen & Woods Fast Money Alert
Today, we’ve identified a fast-money stock that has been moving higher as a result of several major tailwinds. Those tailwinds are the upcoming fiscal stimulus, an economic return to normalcy due to the COVID-19 vaccine and improvement in the number of case counts and death rates and the rising tide of higher Treasury bond yields.
That stock is Signature Bank. The New York-based commercial bank offers a wide range of business and personal banking products and services, mainly to customers in New York and the surrounding regions. The operating segments of the company include a commercial banking segment and a specialty finance segment.
SBNY shares have been on a tear as of late. In fact, just since the start of this very young 2021, shares are up 40%. That’s a huge fast-money ride, but it is by no means over yet, in our opinion. The reason why is those aforementioned tailwinds, which are forces we believe will continue to fill the sails of the best regional banks and financial stocks in the market today.
Fundamentally, SBNY recently posted fourth-quarter earnings that bested expectations, with earnings per share of $3.26, a record high. And, that metric was up more than 18% from the fourth quarter of 2019. Most impressively of all, the bank grew its net interest income (a bank’s overall profit on loans), by about $56 million in Q4 vs. the same quarter a year ago, and we expect that growth, as well as loan growth, to continue to sustain earnings growth.
So, let’s buy Signature Bank at market, with a protective stop at $154.00.
For those willing to take a bigger bet, we recommend you buy the SBNY June 2021 $200.00 call options (SBNY210618C00200000) at market. The call options last traded for $13.10 and expire on June 18.
Mark Skousen & Jim Woods, Skousen & Woods Fast Money Alert, markskousen.com, Eagle Financial, 300 New Jersey Ave. NW, Suite 500, Washington, D.C. 20001, February 8, 2021