Provident Bancorp Inc (PVBC) Options

Marker:

PVBC

$9.70 -0.08 (-0.82%)
Volume: 27,142

Dumped my shares here today, at 9.72. I don't see much in the way of positive news now that the bank is back to trading near its book value. Up about 35% from my buy point, so that's not too bad.

Late payments on commercial mortgages are piling up as higher rates and weakening property prices bite into the sector

Jun 2, 2023, 7:43 AM MDT

• Late payments for commercial real estate mortgages rose last quarter as pressure builds for the US property market.

• Commercial mortgage borrowers that were late on payments for at least 30 days or already defaulted rose to 3%.

• More signs of stress could surface as high rates and weak property prices take a toll on the sector, the MBA said.

• Late payments on commercial real estate mortgages are rising, a sign that higher mortgage rates and falling property prices are weighing on the US property market.

[....]

Source:
https://news.yahoo.com/payments-commercial-mortgages-piling-higher-214328465.html

*This trend is not our friend.

Marker:
$7.95 -0.21 (-2.57%)

Hi 56Chevy, I hope all is well. Thanks for sharing your knowledge on bank stocks. At what price would you purchase shares of Provident Bancorp Inc?

A great analyst I follow (Chris DeMuth) says that PVBC is basically down in sympathy with Silvergate Bank, which had massive crypto exposure.

According to DeMuth, who has PVBC on his buy list, even if you write off all of PVBC exposure, which is probably overly conservative, as their loans are on crypto mining rigs, not to exchanges or crypto traders, the book value of PVBC is still over $8.00

The kicker is that PVBC was a mutual to stock conversion, but it is past the three year anniversary, so could be a buyout target, based on its regional strength.

DeMuth did very well for me in 2022, and I like his analysis.
I appreciate the kind words, 56chev, but I'm a free member here, so can't respond. Please feel free to post anything that contributes to the conversation.

Thanks for posting the bad news that came out in December.

Of course, that's why the stock dropped from around $15.00 to its current level.
As I understand it, even if the entire 76 million needs to be written off-- which is unlikely, IMO-- the remaining business provides more than ample support for a price a higher than the current level.
Moving on from the former CEO was a good move, of course.

Money is made when you can see that the market has over-reacted to a bad situation.

The bank said its remaining digital asset mining loan portfolio as of Sept. 30 totaled $76.5 million, "of which, upon review, the Company estimates a majority to be impaired and placed on non-accrual status."

This is the bigger news re: the already reported $27.5M digital asset mining loan loss going forward. I expect a decay in pps when the total crypto mining loan losses are identified.

• This is not to say a future stake in this is unwise. In fact just the opposite. IMO we just need to know the full extent of the damage..and wait for the bank to go on-sale.

BankProv CEO resigns after $27.5 million crypto currency hit

Thu, January 5, 2023, 4:52 PM

Jan. 5—Provident Bancorp begins 2023 with new leadership after the December exit of CEO Dave Mansfield, following the bank's report that it expected a third quarter loss of $27.5 million related to loans to a cryptocurrency miner.

[....]

In a Nov. 15 filing to the Securities and Exchange Commission, Provident estimated it would report a net loss of approximately $27.5 million for the quarter ended Sept. 30, 2022, compared to net income of $5.1 million for the quarter ended Sept. 30, 2021.

[....]

"The Company is still evaluating the actual level of losses due to the recent decline in the cryptocurrency mining industry, and such losses may exceed this estimate," the company wrote.

"During the third quarter of 2022, the volatility in Bitcoin and rising energy costs called into question the financial stability of the Company's borrowers who hold digital asset mining loans, the collectability of all principal and interest related to these loans, as well as the value of the cryptocurrency mining rigs that serve as the underlying collateral."

The bank said its remaining digital asset mining loan portfolio as of Sept. 30 totaled $76.5 million, "of which, upon review, the Company estimates a majority to be impaired and placed on non-accrual status."

[....]

Source:
https://news.yahoo.com/bankprov-ceo-resigns-27-5-235200484.html

Marker: current pps $7.39

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Created this board to follow & discuss Provident Bancorp (PVBC) which was just added as a buy by Chris DeMuth of SIfting the World. DeMuth made me a bunch of money in 2022 with his pick of RENN, a Chinese company with a litigation angle, that resulted in a $31.00 payout to shareholders in Dec 2022.

He just [ut this on his buy list yesterday.
The company took a huge price hit last November when FTX went down, as it has been providing banking services to crypto players. DeMuth sees it as oversold, with some good basic business lines, and some kickers like potential buyout.

I've got a nice starter position. Welcome all comments, thoughts.