Nothing I say is financial advice.
Joined December 2025
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Anyone with thoughts on $WOBK?
˜6x EPS and 1x TBV. It appears they have a strong deposit franchise in Woodsboro/Thurmont + very low COF (0.96%).
That long-dated low-yield securities book scares me though, as well as the CRE exposure. Mgmt doesn't seem interested in talking with investors.
No pos
$SVBT Q3 earnings:
One of the few 'good' banks left to be got at a sub-6 multiple (now at 5.8x run-rate earnings). Managed to buy some more at the open.
- NI +13% QoQ to 3.4mn, 17% ROE.
- Asset quality unchanged (i.e. excellent)
- COF is down QoQ but that might be because of some weird interest rate spike in their CD>250k in Q2. Not knowledgeable enough to say what's driving that, possibly timing, as Q1 was on the low side.
- Otherwise it's too early to tell if improvements in COF (that I forecast in the other tweet) will come through. No changes in public/private deposit mix yet.
- Even without that, this is a good bank with good managers, 2% ROA, 17% ROE, a nice advisory/trust business on top, trading sub-6x. Upside ˜80-100%.
Another community bank that I like:
$SVBT (6.5x EPS, 80% upside):
Springs Valley Bank & Trust Company. Based in French Lick, IN.
- SVBT is a high quality bank on most metrics (1.8% ROA, 12.5% (!) leverage -> 15% ROE)
- The one pain point is the cost of funds. In the past they funded a bunch of growth with county deposits, which are high cost.
- Fortunately, SVBT now has a CEO/CFO team that is young, shrewd, and go-getting. They are working hard on replacing those deposits. They have a pretty decent franchise (35% avg market share) so it should be possible to make some improvements there.
- The co also has a $1bn trust & advisory business driving $6.5mn in annual revenue, pretty big for a bank this size. The segment was going through some leadership transition issues which should be behind us soon, driving further growth.
- Over time I can see the COF improving, which will make this a top tier bank. The trust business provides some upside optionality in addition to the growth of the traditional banking operations.
- SVBT is currently trading around 6.5x run-rate EPS (assuming Q3 will be in line with Q2). In time I think this bank could demand a 12x multiple (80% upside).
- Risks: ag exposure a bit on the higher side (23%), and the COF inflection might not play out.
A more general comment:
Everyone has their own style when it comes to these banks. Some prioritize growth or ROE, some look for M&A targets, inflections, etc.
In general I’m trying to skew a bit more conservative, which is why I like eg $FXLG at 8x over some other growthier names at 7x. Although I own some of those too.
I personally also don’t mind slightly lower ROE if ROA is high (i.e. ROE is lower than it could be due to low leverage).
I think SVBT is a good example of this, and strikes a nice balance between growth, quality, and cheapness.
Either way, I’m learning as I go. Feedback always welcome.
Long $SVBT, NFA
Another community bank that I like:
$SVBT (6.5x EPS, 80% upside):
Springs Valley Bank & Trust Company. Based in French Lick, IN.
- SVBT is a high quality bank on most metrics (1.8% ROA, 12.5% (!) leverage -> 15% ROE)
- The one pain point is the cost of funds. In the past they funded a bunch of growth with county deposits, which are high cost.
- Fortunately, SVBT now has a CEO/CFO team that is young, shrewd, and go-getting. They are working hard on replacing those deposits. They have a pretty decent franchise (35% avg market share) so it should be possible to make some improvements there.
- The co also has a $1bn trust & advisory business driving $6.5mn in annual revenue, pretty big for a bank this size. The segment was going through some leadership transition issues which should be behind us soon, driving further growth.
- Over time I can see the COF improving, which will make this a top tier bank. The trust business provides some upside optionality in addition to the growth of the traditional banking operations.
- SVBT is currently trading around 6.5x run-rate EPS (assuming Q3 will be in line with Q2). In time I think this bank could demand a 12x multiple (80% upside).
- Risks: ag exposure a bit on the higher side (23%), and the COF inflection might not play out.
A more general comment:
Everyone has their own style when it comes to these banks. Some prioritize growth or ROE, some look for M&A targets, inflections, etc.
In general I’m trying to skew a bit more conservative, which is why I like eg $FXLG at 8x over some other growthier names at 7x. Although I own some of those too.
I personally also don’t mind slightly lower ROE if ROA is high (i.e. ROE is lower than it could be due to low leverage).
I think SVBT is a good example of this, and strikes a nice balance between growth, quality, and cheapness.
Either way, I’m learning as I go. Feedback always welcome.
Long $SVBT, NFA
Tagging some bank folks: @CorpusCol @curttho28964890 @OurBank3 @Ron284Ron @OtterMarket @eriksen_tim @thebankzhar