Sell Alert: Bank of the Ozarks (OZRK)

By Jim Pearce • October 20, 2017

TRADE INSTRUCTIONS
Date: October 20, 2017
Name: Bank of the Ozarks
Symbol: OZRK
Type: Close
Limit: Sell at market

TRADE RATIONALE
Two months ago I extended the holding period for OZRK. On that day it closed below $41 after a sell-off sparked by concern that the sudden resignation of the bank’s Chief Lending Officer in July might portend bad news regarding its loan portfolio. But that type of news never surfaced, and with the stock now back up to $47 it’s time to close out this position at a modest profit.

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HowieA

10/20/17 ‐ 11:05pm ET October 20, 2017 at 11:05pm ET

Power of options. When you first recommended OZRK I bought Aug 50 Calls for $.60. They expired worthless. When you recommended an extended holding period I bought Nov 40 Calls for $3.00. I sold them today for $7.10, a profit of $3.50 per option – a 97% profit. Not a bad “modest profit”. Thank you.

Jim Pearce

10/23/17 ‐ 9:58am ET October 23, 2017 at 9:58am ET

Howie – Nice trade! That is the way smart traders do it when the initial pick doesn’t work out as planned. Well done.

Derek: Las Vegas, NV

12/19/17 ‐ 2:21pm ET December 19, 2017 at 2:21pm ET

Hey Jim,

With the new tax plan and the higher probability of regional bank M&A, do you think OZRK would be one of the banks to look at again?

Derek

Jim Pearce

12/20/17 ‐ 9:55am ET December 20, 2017 at 9:55am ET

Yes, especially since OZRK is one the few that has lost value this year despite posting record results during its most recent quarter (https://finance.yahoo.com/news/bank-ozarks-announces-record-third-110000340.html). As for M&A activity, I doubt OZRK will be acquired so if you are looking for a potential acquiree then I’d suggest focusing on smaller banks with a market cap in the $500 million – $1 billion range as FBNC or PCBK.

Derek: Las Vegas, NV

12/20/17 ‐ 2:38pm ET December 20, 2017 at 2:38pm ET

Awesome, thanks for the update Jim.

Derek

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