The OTHER Greek Bank - Alpha Bank?
Could this be the next AIBYY?
There are two Greek banks available to invest in on American exchanges, similarly there are two Irish banks to invest in on American exchanges.
NBG is on the NYSE, as is IRE.
ALBKY is on the OTC, as is AIBYY.
IRE is trading very close to its book value, which is standard for a bank stock in the current environment of bank-mistrust and post recessionary fears.
AIBYY is trading at four times it's book value and is a smaller bank and less profitable than IRE, with most of its shares held by the government; ie, it's share price has become completely unhinged from what its fundamentals would justify!
What similarities do I see between AIBYY whcih would lead me to conclude a similar situation could arise with ALBKY?
-Trading on the OTC, meaning book value isnt listed on just about any webpage that most retail investors use when judging a stock. Book value is one of the most easy to hand fundamentals lazy investors use to judge a stock and most won't bother to dig into the financials to find out the truth.
-Posterchild for recession. Remember the psychology, retail investors believe emphatically that investing in any nation that has gone through what Greece or Ireland has gone through, must surely represent extreme value, because of a RISK premium. These same retail investors however are secretly risk averse, and hedge their bets by investing into banks which carry a "too big to fail" insurance policy against total wipeout.
-Government ownership means that though officially a large cap, they trade like small caps, meaning small waves of investor interest can move share prices very quickly. OTC penny stocks are tricky to short and are off the radars of most big money institutional investors, meaning things can become completely crazy as we see with FNMA or AIBYY.
-Further to the lottery ticket stock idea, the fact that the chart is misleading. Again, most retail investors only look at charts, they see a giant mountain followed by a rapid decline and a flatline. They don't consider things like r/s, or share increases, meaning once again, AIBYY and ALBKY trade on PERCEPTION and MOMENTUM, far more than on their books.
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Right now ALBKY is trading at around .8 price/book, so the fundamentals provide a nice hedge against risk, and the potential bubbling wave of speculation which could hit would provide a very quick 2 or 3 bagger. Remember, get in before everyone else, be a leader not a follower, let dumb money find you, and it will, in time, either in a big mountain of 'irrational exuberance', or else in a slow steady flatline with moderate growth (worst case scenario).
