One of the easiest ways to track news and events during the day is to use news alerts. I have alerts set on Google(GOOG) news that send me alerts for key phrases like Plan of Liquidating, Activist Investor, Deep value Investing, Strategic review and other key phrases that might signal a potential opportunity. I also have it set to track statements and activities by people like Wilbur Ross, David Rubenstein, Seth Klarman and James Montier. It save me a lot of time and makes sure I get the news I want as quickly as possible during the rush of the day.

The other day I got an alert on my activist investing ping. The folks over at ValueWalk.com had released an article on activist investors in community bank stocks. Now, community banks are high on my radar and I am a great admirer of the job Jacob Wolinsky and his team are doing at ValueWalk so I dropped everything to give it a read. To call it impressive and interesting is a massive understatement.

It seems that analysts at Stern Agee have taken a look at what happens when activist investors take a stake in a small bank. The simple answer is that investors in the bank end up making a whole bunch of money. Matthew Kelly and his crew of bank analysts found that over the past decade small banks with activist engagement experience substantial excess returns over the index. In fact they earn shareholders about 29% more than the NASDAQ Bank index. 29% of the institutions are sold after the activist get involved and those transactions usually result in a large profit for investors in the bank as well. Its impressive performance and suggests that tracking activist activity in small banks is a worthwhile activity.

While sifting through the 13D filings for hundreds of small banks can be a pain there is an easier way. As part of the Banking on Profits Monthly I will do it for you each month for a total cost of $99 a year. I track the leading bank stock activists like PL Capital, Joseph Stilwell, Clover Partners, Basswood Capital, Lawrence Seidman and FJ Capital. I also keep track of smart value investors with a penchant for bank stock like EJF Capital, Arbiter Partners and Michel Price. In addition to tracking the regular 13D filings every quarter I do a review of their entire portfolio activity when the 13f filings are released. Of course you also get info on insider buying, dividend increases, buyback announcement and just about everything else going on with the small banks each month. Small Banks are the trade of the decade and tracking activists in this space can make you a lot of money.

The selloff in energy related stocks continue this week. It seems that Saudi Arabia has abandoned its desire to hold prices steady and is lowering prices to keep market share. The fact that a short term price war in crude badly hurts ISIS and Russia shared competitors and enemies of the US and the Saudis is merely coincidental and I am sure did not factor into this discussion at all. We will see if other Arab nations engage the Saudis in a price war and push prices lower.

As a result of this oil and related stocks have gotten hammered. You can buy new drilling rigs at 70% on the dollar on the stock exchanges right now. Oil services companies are apparently no longer charging for their services and will be going bankrupt whether they have any debt or not. I tis intriguing that we started to see decent levels of insider buying in many oil drilling and services stocks at prices 20% higher than the current levels. In addition to more insiders buying I expect to see some merger and Private equity buying in these sectors if pricing doesn’t improve relatively soon. Those short the oil complex might want to consider the warnings of the King of the North in the hit HBO series Game of Thrones. Winters Coming. It has been painful in the short term but I added to drillers and established a new position in an oil services company whose price dropped into the Bottom Decile.

Right now my portfolio looks like a cross between an energy fund and a bank fund with a few net-nets thrown into the mix. And lots and lots of cash. I have no idea what the stock market will do in the next few months or even next year. Economic prognostication is way above my pay grade as well. I am however pretty certain that over time things will get better and these cheap stocks will trade a lot higher than the current quotations. I am certain that the demographic, social and economic trends that affect the community banks will lead to enormous profits over the next decade or so. Time, patience and a strong stomach are my biggest weapons in the battle for stock market profits.

Now its off to watch the Orioles Tigers playoff games! Go Birds!

Cheers !

Tim

Keep in mind that to make long term profits in the market you have to ignore the short term

 https://www.youtube.com/watch?v=hXvQDsXN3iw