Disclosures

Center Financial Corporation

I, Joe Gladue , certify that this report reflects my personal beliefs about this company and that no portion of my compensation was, is or will be directly or indirectly related to the specific recommendations or views discussed in this report.

Disclosure

  • B. Riley & Co., LLC does and seeks to do business with companies covered in its research reports.
  • A portion of this analyst’s compensation is based on the sales, trading and investment banking activities of B. Riley & Co., LLC.
Disclosure Chart

Initiated Coverage on 06/22/2008 with "Buy" Rating and Price Target of $8.00

Ratings Distribution as of May 17, 2012 % with Investment Banking Relationships
Rating Number of Companies Percent of Total Rating Number of Companies Percent of Total
Buy 112 73.7% Buy 13 100.0%
Neutral 37 24.3% Neutral 0 0.0%
Sell 3 2.0% Sell 0 0.0%
Total 152 100% Total 13 100%

Explanation of B. Riley & Co. LLC's Rating System

  • Buy: We generally expect "Buy" rated stocks to materially outperform both the S&P 500 and Russell 2000 as well as other stocks in their sector. Further, we believe that the potential reward relative to the potential risk is particularly attractive.
  • Neutral: We generally believe "Neutral" rated stocks will perform roughly in line with the S&P 500 and Russell 2000 over the intermediate and long term.
  • Sell: We generally expect "Sell" rated stocks to materially underperform both the S&P 500 and Russell 2000 as well as other stocks in their sector. Further, we believe that the potential reward relative to the potential risk is particularly unattractive.

Risks and Considerations

  • Acquisition/Integration - The Company recently completed acquisition(s). If the Company fails to successfully integrate the acquisition, the deal may lead to disappointing returns.
  • Asset Quality - Areas in which the Company operates are suffering from the fallout of the subprime mortgage debacle with increasing delinquencies and foreclosures, higher unsold home inventories and declining sales prices. These problems are leading to troubles in residential construction loans and residential mortgages and they appear to be spreading to commercial real estate as well. While the Company is a conservative lender, the troubles are broadly based and likely to affect all lenders to some degree.
  • Competition - The industry is highly competitive and many of the Company's competitors have greater resources.
  • Economy - Macro-economic issues such as increasing oil and gas prices and a possible drop in consumer spending could have a negative impact on the Company's business.
  • Sector Rotation - Negative news by large financial services firms regarding CDOs and sub-prime loans and by banks in markets hit hard by real estate malaise could continue to put pressure on valuations for the sector. Accordingly, the trading price of the Company's common stock may be vulnerable to sector rotation despite not having exposure to these issues.
  • General Industry - The Company could miss our estimates and/or their financial guidance.
  • Further Potential Risks - See the Company's SEC filings, particularly its 10-K filing, for a discussion of further potential risks.

Additional Risks and Considerations

     

     

     

     

     

     

     

     

     

  • Pending Merger of Equals - The company is involved in a pending merger of equals. Should this merger fall apart, the company could lose opportunities for cost saves and revenue enhancements and the stock could suffer. In addition, completion of the merger raises the possibilities of integration problems that could also affect profits.

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