Point72 Asset Management leader Steven Cohen (Trades, Portfolio) disclosed a stake in First Bancorp (FBNC, Financial) on Dec. 12.
The billionaire investor uses a bottom-up approach to identify discretionary long-short equities. Managing a portfolio of 845 holdings, Cohen is largely invested in the consumer cyclical and health care sectors.
Cohen invested in 12.1 million shares of First Bancorp for an average price of $36.95 per share, giving it 1.95% portfolio space.
The North Carolina-based bank holding company has a market cap of $1.09 billion; its shares were trading around $36.72 on Thursday with a price-earnings ratio of 21.33, a price-book ratio of 1.69 and a price-sales ratio of 4.48.
According to the Peter Lynch chart below, the stock is trading above its fair value.
GuruFocus ranked First Bancorp’s financial strength 4 of 10 and its profitability and growth 3 of 10. The company’s trailing dividend yield is 0.86% and its forward dividend yield is 0.87%. The dividend payout ratio is 19%.
For the third quarter, the company posted earnings per share of 53 cents, beating estimates of 49 cents and increasing from 23 cents in the prior-year quarter. Net interest income for the quarter was $41.6 million, a 37.2% increase from the year-ago quarter.
The bank noted the improvement in its performance was partially due to the absence of a non-recurring expense which had hurt its third-quarter 2016 results. Last year, First Bancorp was impacted by the termination of a loss share agreement with the Federal Deposit Insurance Corp., which caused the bank to incur $5.7 million in additional indemnification asset expenses. This was partially offset by an “exchange of branches” with another regional bank, which resulted in a gain of $1.4 million.
The company was also boosted by Carolina Bank Holdings Inc., which it acquired in March.
Cohen is now the bank’s largest guru shareholder with 5.6% of the company. Jim Simons (Trades, Portfolio) also owns the stock.
GuruFocus estimates the stock has gained approximately 35% year to date.
Disclosure: I do not own any stocks mentioned.
