Tag - Gbts

Gateway Financial Holdings (Nasdaq:GBTS) is up 13% this morning following the company’s announcement that it had closed on a $37.5 million capital raise.

The Virginia Beach, Va.-based bank holding company said after the bell on Tuesday that it had priced and sold 37,550 shares of its Series B preferred stock.

The move was one of the conditions of a previously announced merger agreement with Hampton Roads Bankshares Inc. (Nasdaq:HMPR). The merger is slated to be complete in the 2008 fourth quarter.

By late morning, Gateway Financial is at $6.05, up $0.70 from Tuesday’s close. The stock has traded as low as $2.68 and as high as $15.36 in the past year.

For detailed price information and news stories on Gateway Financial Holdings, click GBTS.

Hot Topic, Inc. (Nasdaq:HOTT), Republic Airways Holdings Inc. (Nasdaq:RJET) and Mothers Work Inc. (Nasdaq:MWRK) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $1 billion.           

Also included among the results: Met-Pro Corp. (Nasdaq:MPR), PowerSecure International Inc. (Nasdaq:POWR), Gateway Financial Holdings Inc. (Nasdaq:GBTS), Transcat Inc. (Nasdaq:TRNS), Integral System Inc. (Nasdaq:ISYS) and Innovative Solutions and Support Inc. (Nasdaq:ISSC).     

Here are the biggest percentage losers among small caps:  

Small-cap stocks generated a solid rally through several minor economic reports this morning and then sustained the upside push through a volatile, but ultimately upbeat reaction to the Federal Open Market Committee announcement, which either stalled or ended a rate cut cycle that began back in September 2007. For the day, the Russell 2000 (NYSE:IWM) rallied 8.38, or 1.18%, to 716.30.

The rally in small caps basically recovered about two-thirds of the big slide from Tuesday, but failed to suggest that the market’s breakdown into a new lower range was premature. It will take a decisive push back above 720.50 to validate any kind of bottoming action from today’s rally, or else it will simply look like a dead-cat bounce amid oversold conditions.

The much-awaited FOMC news fulfilled market expectations, and the rally in stocks in the face of no rate cut to serve up cheap money in difficult times was a decent showing.

As for the announcement itself, “The bottom line is that the Committee is now in a wait-and-see mode to see how the economy and inflation unfold during the second half of the year,” Steven Wood, chief economist with Insight Economics, said in an email.

Wood noted that an improvement in economic conditions should spur tighter monetary policy but that a weaker economy might not prompt further rate cuts unless inflation abates. “We believe that the tax rebate effect on consumer spending will quickly fade as the summer progresses and energy prices stabilize or retreat slightly. This . . .

Small-cap stocks are rallying in Wednesday midday trading, as oil futures declined sharply after the Energy Department said oil and fuel supplies are larger than expected. Investors are waiting for news from the Federal Reserve’s rate committee, which wraps up a two-day meeting this afternoon. The Fed is widely expected to end the rate cut cycle and talk tough on inflation. At 2:01 p.m. ET, the Russell 2000 (NYSE:IWM) was up 7.88, or 1.11%, at 715.80.

Crude oil prices are sharply lower in afternoon trading. The Energy Department said in its weekly inventory report that crude oil supplies rose, while Wall Street expected a 1.7 million barrel decline. The supply increase gave investors reason to believe that skyrocketing gas prices have lowered demand. Crude is down 3% to $132.73 a barrel in recent trading.

The new home sales report clocked in at minus 2.5% and the inventory of new homes was at 10.9 months, which was a mild rise over the previous report. Although the home sales data was weak, it didn’t deter the stock market, which is already focused on the Fed later today.

“Set the snooze button for 2:15 ET PM today for the FOMC decision and we'll all be tearing apart the text for nuances on what to expect going forward. Market has 50 basis points of tightening priced in for Fed Funds by the end of December,” Andy Busch, global foreign exchange strategist for BMO Capital Markets, said in an email. “The U.S. Treasury's auction of two-year notes Tuesday showed a big surge in demand with the bid to cover ratio at 2.64, up from 2.28 last and an indirect foreign bids of 27.7% that show Treasury market participants believe the Fed tightening . . .

Gateway Financial Holdings, Inc. (Nasdaq: GBTS), the holding company for Gateway Bank & Trust Co., recorded stronger-than-anticipated results for the third quarter.

The provider of commercial and retail banking services in northeastern North Carolina and in the Tidewater area of southeastern Virginia reported net income for the third quarter of 2007 of $4.2 million, or $0.32 per share, well above the $0.23 two analysts polled by Thomson Financial were on average forecasting. Last year the company earned net income of $2.8 million, or $0.25 per share. (Per share results reflect the issuance of additional shares for the acquisition of The Bank of Richmond.)

The small cap attributed its robust earnings to reflect “exceptional” revenue growth from a 57.1% increase in loans over the past 12 months and increased revenues from its non-banking activities.

Total revenue, which the bank defines as net interest income and non-interest income, was $19.7 million, above an analyst’s estimate of $16.7 million polled by Thomson Financial. The current quarter’s revenue represents an increase of 41.5% above the $13.9 million reported for the third quarter of 2006.