Christopher Blake, President and CEO at PacWest Bancorp (PACW), recently bought 6,660 shares. The buy increased his holdings by 3 percent, and came to a total cost just over $118,000.
He was joined by the company’s COO, who bought 3,148 shares for the price of $48,000. And a company director bought 25,000 shares, at a cost of $383,250. Other company insiders have been buyers in the past week as well, as shares of the regional bank have taken a big dive.
Overall, insiders own 1.8 percent of the company.
The bank’s shares have been hit hard in recent days, and the stock is down nearly 78 percent over the past year. Rising interest rates have impacted the bank’s profitability as well, with revenues down nearly 20 percent over the past year, and earnings down by nearly two-thirds.
The recent selloff has taken the bank to less than 0.5 times its book value, or the measure of all its outstanding loans.
Action to take: Investors may find some opportunities in the banking space over the next few weeks, given the steep discounts that these stocks now trade at. However, investors should tread lightly, and look to take quick profits, given how volatile the sector has been.
For traders, the June $20 calls, last going for about $1.60, could potentially give more than triple-digit gains in the months ahead or expire worthless. Chances are shares will partially rebound in the coming months, making this a reasonable trade for this beaten-down sector.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.