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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of regional bank Cathay General Bancorp (Nasdaq: CATY ) climbed 11% today after its quarterly results topped Wall Street expectations.
So what: Cathay's third-quarter results were so solid -- net income jumped roughly 20% to $26.2 million -- that analysts have no choice but to raise their valuation estimates. Management cited lower provision for credit losses and strong growth in lending for the market-topping results, giving investors plenty of confidence over the sustainability of its growth going forward.
Now what: Don't let today's double-digit pop keep you from looking into the stock. "We expect to maintain steady commercial loan and residential mortgage loan growth in the fourth quarter," said Cathay Chairman and CEO Dunson Cheng in a statement. More importantly, with the stock still trading at a reasonable forward P/E of 12, there might be some room left to buy into that bullishness.
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