UCBH, a holding co., conducts business through its subsidiary, United Commercial Bank, a federally chartered commercial bank. For the FY ended 12/31/00, total interest income rose 18% to $186.7M. Net int. income after loan loss prov. rose 13% to $73.2M. Net income rose 27% to $24.1M. Net interest income reflects increased average loans outstanding, partially offset by a higher loss prov. Net income reflects higher commercial banking fees.

March 15, 2001

California bank holding company UCBH Holdings (UCBH) specializes in serving the Asian community in its primary markets, which include San Francisco, Sacramento and the Los Angeles. This niche has paid off tremendously for the bank, which has reported 10 consecutive quarters of double-digit earnings growth. Wall Street certainly has been impressed with the company’s track record, as all seven firms covering UCBH place its stock in the “Buy” column. More compelling, the company announced a 2:1 stock split today, which will be payable on April 10th to shareholders of record on March 31st. We’re anticipating this announcement to attract more buyers by month's end. Looking at the chart, UCBH shares signaled a near-term bottom. Yesterday, the stock produced a sharp bounce off the half-century mark ($50), which was followed by a gain of 1.57% in today’s trading. The short-term technical readings also point to a turn around, with the stochastic planted firmly in oversold territory and the OBV trending higher. As for possible entry points, a move above the converging 10 and 20-dma’s of $54.58 and $54.56 may provide a profitable entry opportunity. We’ll set stops at $49 to limit our downside risk.

Picked on March 15th @ $52.63
Change since picked 0.00
Stop Loss @ $49.00

March 22, 2001

On Wednesday the broad markets sold off sharply, with the Dow Jones Industrial Average (INDU) posting another triple digit loss. During this rush of this selling, UCBH fell $3.13 to close at $49.81. At this level it didn’t take much of a fall to hit our stop of $49, which is exactly what happened in today’s trading. We will continue to watch this fundamentally sound company for better opportunities in the future.

Picked on March 15th @ $52.63
Profit/Loss = -3.63 (-7%) (Stopped Thursday @ $49.00)
Best Profit = +1.37 (+3%)

March 20, 2001

Today’s 50 basis point rate cut by the Fed was a step in the right direction, but Wall Street had hopes of more easing. With expectations of a 75 basis point cut in interest rates, even the financial sector showed susceptibility to the Fed’s decision. The NYSE Financial Index (NF) fell 12.82 points or 2.20% to close at 567.71. The broad industry decline did have bearing on UCBH shares, which finished lower by $0.50 to close at $52.94. We do, however, believe that selling pressure could be short-lived now that the federal funds stands at 5 percent, matching its lowest level since mid-1999. Moving to the chart, today’s decline was accompanied by light daily volume of 92,400 shares, which is notably less than the three-month average. This indicates that there is a lack of investors willing to drop shares at current levels. In addition, the stochastic is still pointing to higher levels and the OBV is moving higher on positive days. With that said, should shares trend higher later this week, we’ll look for resistance to emerge at the 30-dma of $54, followed by a harder challenge at the $55 mark. Support will come at the 50-dma of $50.78. Look for entry points when shares bounce off support or break above the 30-dma on volume of at least 75,000 shares traded by midday.

Picked on March 15th @ $52.63
Change since picked +0.31
Stop Loss @ $49.00

March 18, 2001

The high probability of further cuts coming with Tuesday’s FOMC announcement certainly bode well for our play for the week ahead. We’re also anticipating an influx of buying to arise as shares approach the March 31st record date for the upcoming stock split. With these two events in mind, it’s no surprise that the stock is already starting to gather momentum on the upside. What’s more, UCBH has trended higher for the past three days, which confirms its short-term uptrend. Looking at the chart, UCBH shares rallied higher on Friday, adding $0.50 or 0.95% by the closing bell. The stock did flirt with higher levels on an intraday basis, but found a stiff barrier at the 30-dma of $53.77. A look at the technical indicators show the MACD is still negative, but could be in process of rounding out. On Balance Volume continues to make higher highs and indicates that there is solid buying of the stock on positive days. Traders considering an initial entry point should wait for a sharp break through the converging 10 and 20-dma’s of $54.37 and $54.54, respectively. Support will come at the 50-dma of $50.46. We’ll continue to hold stops at the $49 mark to protect on the downside.

Picked on March 15th @ $52.63
Change since picked +0.50
Stop Loss @ $49.00