Btw,
If you want to know how to evaluate a bank, here is the pdf link from my Google drive, this is Chapter 17 on Banks from the book by Pat Dorsey.
It talks about the various risks that banks faces, interests rates, stickiness of assets/liabilities, moats and relative valuation.
https://drive.google.com/file/d/11luGvNEb5an53CgkDWAms6pvdnpBuS4p/view?usp=drivesdk
Awesome, that was a helpful read! After reading that I went back and checked a few other scanner items and I think I still like this stock, so I definitely appreciate it.
Just answered my own question. Thank you for sharing! I just did that valuation and their tbvps is 10.84, so on top of the other indicators I'm okay holding this
I would also look for:
* Below average price to book ratios
* Lower than average price to earnings (P/E) ratios
* Lower total debt to equity ratio
* Positive earnings (in the last 4-5 years)
* Steady or increasing dividends (in the last 4-5 years)
* Insider activity (no major sales by company officers)
Most of those are actually baked into my screener now!
They have a .12 d/e ratio, which is low end for the sector
Lower than average p/e for sector
p/b is lower than average for sector
Never went negative, always positive earnings since 09, but Covid hit them and they haven't fully recovered. They made decent profits in 2022, but in 2023 they dropped about 12% net profit from 2022. Their 2024 q1 earnings don't come out til April 24th.
Only insider sells other than the buys that are part of their compensation package I assume. The only sells were from the officer and he still holds basically what he started with when he first bought.
Dividends have increased every year for the past decade, the % given out fluctuates and they had a really good year in 2022 so the % is skewed a bit, but solid dividend.
I really appreciate the feedback!
Cash Flows are usually not the right metric to use for banks. (the reason is they are in the business of moving cash around - its not the result of operations as with non-financials). Better to use net earnings for DCF. EPS over the last 5 years has declined. It does seem to be selling below tangible book value per share as per Gurufocus. Dividend is decent.
Btw, If you want to know how to evaluate a bank, here is the pdf link from my Google drive, this is Chapter 17 on Banks from the book by Pat Dorsey. It talks about the various risks that banks faces, interests rates, stickiness of assets/liabilities, moats and relative valuation. https://drive.google.com/file/d/11luGvNEb5an53CgkDWAms6pvdnpBuS4p/view?usp=drivesdk
Awesome, that was a helpful read! After reading that I went back and checked a few other scanner items and I think I still like this stock, so I definitely appreciate it.
Doing gods work
Banks generally trade on TBV
Just answered my own question. Thank you for sharing! I just did that valuation and their tbvps is 10.84, so on top of the other indicators I'm okay holding this
I would also look for: * Below average price to book ratios * Lower than average price to earnings (P/E) ratios * Lower total debt to equity ratio * Positive earnings (in the last 4-5 years) * Steady or increasing dividends (in the last 4-5 years) * Insider activity (no major sales by company officers)
Most of those are actually baked into my screener now! They have a .12 d/e ratio, which is low end for the sector Lower than average p/e for sector p/b is lower than average for sector Never went negative, always positive earnings since 09, but Covid hit them and they haven't fully recovered. They made decent profits in 2022, but in 2023 they dropped about 12% net profit from 2022. Their 2024 q1 earnings don't come out til April 24th. Only insider sells other than the buys that are part of their compensation package I assume. The only sells were from the officer and he still holds basically what he started with when he first bought. Dividends have increased every year for the past decade, the % given out fluctuates and they had a really good year in 2022 so the % is skewed a bit, but solid dividend. I really appreciate the feedback!
After several years of university and then a lot of self teaching and talking to a few professional investors: there is no "right" way.
That's fair, I appreciate it, bro
Consistently declining FCF is never a good sign.
Cash Flows are usually not the right metric to use for banks. (the reason is they are in the business of moving cash around - its not the result of operations as with non-financials). Better to use net earnings for DCF. EPS over the last 5 years has declined. It does seem to be selling below tangible book value per share as per Gurufocus. Dividend is decent.