Hot Stock Buzz: Parke Bancorp, Inc. (NASDAQ: PKBK)

On Monday, Shares of Parke Bancorp, Inc. (NASDAQ: PKBK) lost -0.72% to $20.80. The stock opened its trade at $20.24 and after floating in a price range of $20.24 to $20.85; the stock grabbed the investor’s attention and traded 13,063 shares as compared to its average daily volume of 11.93K shares. The stock’s institutional ownership stands at 26.60%.

Parke Bancorp, Inc. (PKBK), the parent company of Parke Bank, declared its operating results for the quarter and year ended December 31, 2017.

Parke Bancorp stated net income available to common shareholders of $10.80M, or $1.40 per common share and $1.24 per diluted common share, for the year ended December 31, 2017. This compares to $17.30M, or $2.31 per common and $1.92 per diluted share, for the year ended December 31, 2016. The 2016 period included an about $9.30M pre-tax gain from the sale of our SBA related assets in April of 2016, which included a $7.60M gain on sale and relief of $1.70M of related allowance for loan losses. Income before income taxes for the year was $24.20M, contrast to $18.30M for the same period last year, excluding the gain from the sale of SBA related assets in 2016, a boost of $5.90M or 32.4%.

For the quarter ended December 31, 2017, net income available to common shareholders was $325.0K, or $0.04 per common share and $0.06 per diluted common share, contrast to net income of $3.10M, or $0.41 per common and $0.35 per diluted common share for the quarter ended December 31, 2016. Income before income taxes for the quarter was $6.30M, contrast to $5.30M for the same period last year, a boost of $1.00M or 19.6%.

The following is a recap of other noteworthy items that influenced the fourth quarter of 2017 contrast to the same quarter last year: a boost of $1.90M in interest income, mainly attributable to higher loan volumes, partially offset by a boost of $563.0K in interest expense because of higher deposit volumes, a $200.0K decrease in the provision for loan losses mainly because of improving credit quality, a $127.0K increase in noninterest income and a $662.0K increase in noninterest expense partially attributable to higher compensation expense because of normal salary increases and increased benefit expense.

At December 31, 2017, Parke Bancorp’s total assets increased to $1.140B, from $1.020B at December 31, 2016, a boost of $121.30M or 11.9%.

Parke Bancorp’s total investment securities portfolio reduced to $40.30M at December 31, 2017, from $47.10M at December 31, 2016, a decrease of $6.80M or 14.5%. During the fourth quarter an impaired collateralized debt obligation security (TRUP) with a carrying value of $705.0K was sold.

Parke Bancorp’s net loans increased to $1.010B at December 31, 2017, from $852.00M at December 31, 2016, a boost of $159.80M or 18.8%.

At December 31, 2017, Parke Bancorp had $4.50M in nonperforming loans representing 0.5% of total loans, a decrease of $6.80M or 59.9%, from $11.30M of nonperforming loans at December 31, 2016. Other Real Estate Owned (“OREO”) at December 31, 2017 was $7.20M, contrast to $10.50M at December 31, 2016, a decrease of 31.2%. Nonperforming assets (consisting of nonperforming loans and OREO) represented 1.0% of total assets at December 31, 2017, as contrast to 2.1% of total assets at December 31, 2016. The Company has been able to continue to reduce nonperforming assets through sales and workouts while mitigating the financial impact. Loans past due 30 to 89 days were $444.0K at December 31, 2017, a decrease of $192.0K from the previous quarter end.

At December 31, 2017, Parke Bancorp’s allowance for loan losses was $16.50M, as contrast to $15.60M at December 31, 2016. The ratio of allowance for loan losses to total loans was 1.6% at December 31, 2017, and 1.8% at December 31, 2016. The ratio of allowance for loan losses to non-performing loans improved to 364.7% at December 31, 2017, contrast to 137.9%, at December 31, 2016.

At December 31, 2017, Parke Bancorp’s total deposits were $866.40M, up from $788.70M at December 31, 2016, a boost of $77.70M or 9.9%. The increase was mainly attributable to the successful opening of two new branch locations and a marketing campaign to generate additional deposits.

Parke Bancorp’s total borrowings were $128.10M at December 31, 2017, a boost of $35.00M from December 31, 2016, or 37.6%, utilized to fund loan growth.

Total shareholders’ equity increased to $134.80M at December 31, 2017, from $127.10M at December 31, 2016, a boost of $7.70M or 6.0%.

PKBK has a market value of $158.80M while its EPS was booked as $1.41 in the last 12 months. The stock has 7.58M shares outstanding. In the profitability analysis, the company has net profit margin of 27.20%. Beta value of the company was 0.22; beta is used to measure riskiness of the security.

Melinda Duque

Finance Reporter

I am Melinda Duque and I give “The Stock Gem” an insight into the most recent news hitting the “Financial” sector in Wall Street. I have been an independent financial adviser for over 11 years in the city and in recent years turned my experience in finance and passion for journalism into a full time role. I perform analysis of Companies and publicize valuable information for shareholder community.

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Email: melinda.duque@thestockgem.com

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