Best Hometown Bancorp, Collinsville, IL (BTHT)

A Case of a Rantoul Rerun


At the end of the day, this is the story of the man who once ran Rantoul and now runs Best Hometown—Ronnie R Shambaugh.

Ronnie's stats have me anticipating a home run for BTHT shareholders.

Best Hometown Bancorp converted to public ownership in March 2016. If I'm right to suspect the bank could be sold for $16-$18 per share over the next year, investors who buy BTHT today at $11.20 have a fair swing at getting a 50% return.


Disclosure: As of this posting, I own shares of BTHT and may subsequently either dispose of them or purchase more.


Prospective Buyers

Interestingly, First Mid-Illinois Bancshares is currently buying First BancTrust (FIRT) which bought Rantoul First Bank (RFBK) when Ronnie was its CEO.

First Busey, Champaign, IL (BUSE)
First Mid-Illinois Bancshares, Mattoon, IL (FMBH)
Town and Country Financial, Springfield, IL (TWCF)

Financial Snapshot
as of 12/31/2017
Total assets:
$110M
Tangible book value per share:
$14.99
NPAs to assets:
0.1%
Price to book:
74.7%
Market cap:
$9.3M
Dividend yield:
0%
Trailing 12-month ROA:
- 0.5%
Trailing 12-month ROE:
- 4.7%

The Team

LaMont K Doctor, Chairman
Ronnie R Shambaugh, President and CEO
David W Ganser, Executive VP, Chief Loan Officer

The Game

A proven player has stepped up to the plate at Best Hometown Bank.

This isn't the first time that Ronnie Schambaugh has taken an unprofitable mutual savings bank public and effected a successful turnaround.

Ronnie Ran Rantoul First!

Shambaugh was CEO of Rantoul First Bank (RFBK) in Rantoul, IL from 2001 until its sale to First BancTrust (FIRT) in 2005. He converted that cellar-dweller of a thrift in October 2002, raising money from investors at $10 per share.

He then sold it for over $22 per share as soon as the three-year post-IPO moratorium on selling expired.

Ronnie's up to bat again with BTHT.

Best Hometown Bank was another loser of a thrift before Ronnie joined the team, and it will never earn enough to have a shot at the Big Leagues. When Ronnie took it public two years ago, fans familiar with his game anticipated he'd make some successful turnaround moves next, and he has — increasing loans by 25% and practically eliminating NPAs.

Ronnie's not the spring chicken he was when he ran Rantoul. When this moratorium expires, he will be 69 years old, with a 3-year change of control in hand to carry into retirement.

I predict a rerun: we'll see a sale of Best Hometown Bancorp after the three-year window expires in March 2019. 

Sources

  • Confidential interviews with shareholders and analysts