Tag - Fult

Orexigen Therapeutics Inc. (Nasdaq:OREX), Oriental Financial Group Inc. (Nasdaq:OFG) and Imation Corp. (Nasdaq:IMN) are among the biggest percentage gainers in Wednesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Charlotte Russe Holding Inc. (Nasdaq:CHIC), AirTran Holdings Inc. (Nasdaq:AAI), Overstock.com Inc. (Nasdaq:OSTK), Fulton Financial Corp. (Nasdaq:FULT), Terremark Worldwide Inc. (Nasdaq:TMRK) and Martin Midstream Partners LP (Nasdaq:MMLP).

Union Bankshares Inc. (Nasdaq:UNB), Callaway Golf Co. (Nasdaq:ELY) and S&T Bancorp Inc. (Nasdaq:STBA) are among the new 52-week lows in Wednesday's trading among companies with market capitalizations under $1 billion.

The credit crunch continues to take its toll on the economy, markets, and in particular, banking stocks. Analysts warn not to touch the Bank of America’s of the world, as there are only future write downs ahead. However, with little to no exposure to mortgage-backed securities, regional banks have cleaner and stronger balance sheets and may be overlooked long-term investment opportunities.

“If you’re patient and have the nerves to withstand the volatility of the market, I think you can get into the small-cap space, but you have to be highly selective,” said B. Riley senior banking analyst Andy Stapp. “There are banks whose assets will hold up well. That’s what happened in the last credit cycle, which was a real estate-related cycle.”

The top three qualities Stapp looks for when screening small-cap banks are markets, conservative management profile and the extent of the bank’s construction development portfolio.

“It starts by picking regional banks that operate in markets that have held up better than others,” said Stapp. “Pick banks that aren’t as vulnerable to the rise and real estate market.”

He says banks in California, Florida and Michigan have had a lot of exposure to real estate, as the value of real estate in those states has plummeted. However, there are other states in which the real estate market has better weathered the housing downturn.

“Texas is a much stronger market than the nation as a whole,” said Stapp. “The inventory supply levels are much lower [there]. The markets in the Philadelphia area and mid-Atlantic area have also held up much better.”

According to Stapp, the median value of single family homes in those markets actually rose 1% year-over-year in the fourth quarter, as contrasted with steep double-digit declines in markets like California, Florida and Michigan. 

Some small-cap banks Stapp has “buy” ratings on include Bank of the Ozarks (Nasdaq:OZRK). The bank has one of the bigger construction development portfolios that has less perceived risk than its peers, according . . .