4. Dearborn Bancorp (DEAR) is the bank holding for Fidelity Bank based in Dearborn, Mich. Like nearly every other financial stock, Dearborn fell hard in 2008, dropping from more than $8 per share to below $2. The stock languished below the $1 mark for the final three months of 2009, finishing the year at 47 cents.
Closing Price: $2.23 (June 16)
Total Return (YTD): 379.6%Developments in 2010: Dearborn Bancorp started 2010 on the right foot after it reported fourth-quarter earnings of 55 cents a share, swinging from a year-ago loss of $3.77 a share. The results were sufficient to return the bank to an "adequately capitalized" category under regulatory guidelines for risk based capital, and Dearborn would go on to regain compliance with Nasdaq listing requirements in February. The bank in April revised its fourth-quarter profit to a loss of 76 cents a share, citing an additional $10 million provision for loan losses for the quarter. The stock would run higher again after Dearborn Bancorp said in late April that it swung to a first-quarter profit of 15 cents a share from a year-ago loss of 81 cents a share. Valuation: The allowance for loan losses shrank in the first quarter from the previous quarter, which is a good sign for Dearborn. In addition, the provision for loan losses dropped to $100,000 in the first quarter of 2010 from $10.72 million in the year-ago quarter. However, nonperforming assets have increased the last three quarters to $138.49 million in the first quarter of 2010. The stock is also trading well below Dearborn's book value of $5.62 per share. As of May 28, nearly 19% of Dearborn's 6.48 million float was short, an indication that some traders are betting on a decline.