Analyzing My MBIN Trade

In my recent trade of Merchants Bancorp (MBIN) stock, I purchased shares at $43.81 on February 29th, 2024 and closed the position at $41.31 on March 5th, 2024. Let's take a closer look at this trade through the lens of the CANSLIM investment framework.

CANSLIM Analysis

The CANSLIM framework provides a comprehensive approach to stock selection and analysis. Here's how my MBIN trade stacks up against the CANSLIM principles:

1. C - Current Quarterly Earning: MBIN's most recent quarterly earnings report showed a 22% increase in revenue and a 26% increase in earnings compared to the previous year. This positive earnings growth aligns with the CANSLIM principle.

2. A - Annual Earnings Increases: MBIN's annual earnings have been consistently increasing over the past few years, which is a positive indicator.

3. N - New Products, New Management, New Highs: MBIN has been expanding its product offerings and services, including the recent launch of a $180 million multi-investor fund to support affordable housing. This suggests the company is innovating and adapting to market demands.

4. S - Supply and Demand: MBIN's stock price had been trading near its 52-week high of $48.68, indicating strong demand for the shares. However, the subsequent decline in price during my holding period suggests a potential shift in supply and demand dynamics.

5. L - Leader or Laggard: MBIN is a leading regional bank holding company, with a strong market position in its core business segments.

6. I - Institutional Sponsorship: The stock is held by institutional investors, which is a positive indicator of its investment appeal.

7. M - Market Direction: The overall market conditions during my holding period were relatively stable, with no major market-wide corrections or volatility.

Based on the CANSLIM analysis, my MBIN trade exhibited several positive characteristics, such as strong earnings growth, product innovation, and institutional support. The decline in the stock price does not bother me because I was able to successfully follow the principles I set out