Wed10012014

Business & Real Estate

Market sentiment runs with the bulls

While the national fiscal nightmare appears to be over and the sentiment on Wall Street remains bullish, persistent problems discourage people from entering the market – declining household income, surging prices for key goods and low interest rates for savings.

But investors smart enough to stick with stocks through the past five years are reaping the benefits of the Dow Jones industrial average and the S&P 500 surging to all-time highs.

Several surveys reveal widespread skepticism among individual investors, but the inflows into stock funds have skyrocketed this year, boosting the bullish trend.

A bull market does not say much about the likelihood of a near-term dip, but it indicates that such a pullback should be viewed as a correction to the market.

If you’re compelled to sell when a market dip hits, you might be in a better position by taking some profits now.

Two local banks recently made headlines.

• Boston Private Financial Holdings Inc. (BPFH; $9.71) reported net income of $13.2 million in the first quarter this year, compared with $9.8 million in the same quarter in 2012, a 39 percent increase. The increase was a result of recording no provision for loan losses in the first quarter of 2013.

Boston Private Financial Holdings operates as the bank holding company for Boston Private Bank & Trust Co. (formerly known as Borel Bank & Trust Co.), which has a branch on San Antonio Road in Los Altos.

The company operates in three segments: private banking, investment management and wealth advisory. On the heels of the first-quarter earnings, company officials announced a cash dividend to shareholders of $0.05, a 2.10 percent yield. The 52-week price range per share runs from $7.85 to $10.20.

Analysts generally regard Boston Private Financial Holdings’ stock as underperforming, with a smattering of holds, neutrals and market performs. The median price target is $10, with a high of $11.50.

• Heritage Commerce Corp. (HTBK; $6.93), the holding company for Heritage Bank of Commerce, reported net income of $2.2 million for the first quarter of 2013. The San Jose-based bank, which has a branch on San Antonio Road in Los Altos, celebrated its 11th consecutive quarter of profitability.

Lower credit costs and net recoveries from prior-period loan losses resulted in a $0.07 per average diluted share.

President and CEO Walter Kaczmarek noted that the momentum established over the past several years contributed to the company’s strong performance going into 2013.

“We are continuing to create value for our shareholders and strong relationships with our customers, communities and employees,” he said.

The 52-week price ranges from $5.88 to $7.18, and the company pays no dividend. The median price target is $7.28, with a high of $8.

Alpha Street Research last week upgraded Heritage Commerce Corp. to a buy.

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