This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

What an Analyst Who Likes Astoria Financial Is Missing

Stocks in this article: AF

Astoria's operating performance in 2013 hasn't been that much better than that of 2012, and thrifts in general, several with operating performance far superior to Astoria's, appreciated significantly, if not as much as Astoria. Even with its massive 2013 price appreciation, the $1.35 billion Astoria spent on share buybacks from 2001 to 2006 appears to have been wasted; the weighted average repurchase price over this period was $23. Astoria hasn't repurchased shares since 2008, even when they traded below tangible book value, despite the availability of excess capital.

One final point: Even with AF's depressed late 2012 valuation, short interest in its shares in mid-December 2012 was 11.6%. Short interest fell steadily during 2013, and now stands at a much lower, although still high at 4.9%. So there's some skepticism in the market about where Astoria's price might go from here.

I've just presented what I consider several useful facts about Astoria Financial. Maybe Kleinhanzl believes other facts matter more, and maybe those other facts will propel the stock to $17 per share and beyond in the near term. Or maybe facts don't matter. If a plane runs out of fuel, what happens to it is independent of its passengers' hopes.

But in the stock market, investor hope can be enough to sustain prices, at least for awhile. An investor may choose to bet on hope, but mistaking that for a bet on fundamentals can lead to poor returns in tech stocks and bank stocks alike.

This may be the year that bank and thrift investors relearn this lesson.

At the time of publication, the author had no position the stock mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Harvard Winters is a former financial services sector investment banker who now writes research on banks and thrifts.
3 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs