Friday, August 10, 2007

Horizon Bancorp

Horizon Bancorp is a NASDAQ listed security that has been trading in a range between $25.92 and $28.10 over the past year. With 3,201,980 shares outstanding, a recent price of $26.50 gives a total market capitalization of $85,012,567. While there are certainly larger companies, Horizon Bancorp has definitely earned its place in the pack. Last year, Horizon Bancorp created $2.44 in earnings for every share outstanding.

Horizon Bancorp is currently priced by the market at 10.80 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.

With a share price under $50 a share and earnings per share in excess of $1 a share, Horizon Bancorp could be an interesting value proposition. Consistent earnings are the key to high valuations and this security is well on its way.