Happy New Year to one and all. Now that college football betting has come near a close, it's time to start off the year with a bang. Today I bought JFBC at 50.90. I will sell it in 4 to 6 weeks at 59.46. Here is why I like JFBC:
Jeffersonville Bancorp is a one-bank holding company, which owns all the capital stock of The First National Bank of Jeffersonville. "Jeff Bank" maintains ten full service branches in Sullivan County New York located in Jeffersonville, Liberty, Monticello, Eldred, Loch Sheldrake, Livingston Manor, Narrowsburg, Callicoon, Wal*Mart/Monticello and Wurtsboro. God, don't you just love small town America? Isn't that where all of our great successes always come from?
JFBC has shown sequential quarterly revenue growth for the past 7 quarters. There is no reason to believe, that given today's interest rate structure, that this will not continue. JFBC's return on equity is 14%.
JFBC's stock is up 119% over the last 12 months. Can you beat the market? Of course you can!
JFBC, despite all of this price momentum and growth is still fairly priced at a PE of only 14.
Earnings have increased about 20% per year over the last 4 years and its recent trend is even better…2 months ago, announced third quarter net income after taxes of $1,413,000 ($0.96 per share) up 32% from $1,064,000 ($0.72 per share) for the third quarter of 2001. Earnings for the first nine months of 2002 were $3,969,000 ($2.69 per share) compared to $2,510,000 ($1.68 per share) in 2001, an increase of over 58%.
JFBC pays a 2% dividend. Money is good.
Reasonably healthy consumer loan growth was offset by weak commercial lending in 2002. This environment will continue into 2003. Consumer spending has remained surprisingly healthy throughout the latest recession. Commercial lending, however, has been particularly hard hit, both from in terms of loan growth and in terms of credit quality. This means the small banks should outperform the big banks. Get ready to pound the market.
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