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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
First Financial Bankshares, Inc. (XNAS:FFIN) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
FFIN
Name:
FIRST FINANCIAL BANKSHARES, INC. (XNAS:FFIN)
Sector:
83.49M
Industry:
Banks�Regional
CEO:
Mr. F. Scott Dueser
Total Employees:
1,400
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -120.93% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF FIRST FINANCIAL BANKSHARES, INC.(FFIN) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BANKS�REGIONAL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
41.73
One Month Price Target:
$41.94
Six Month Price Target :
$42.96
Likely Price in One Year's Time:
Ticker:
$44.19
Likely Trading Range Today Under (Normal Volatility)
$41.58
Price Upper limit ($) :
$41.93
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$39.62
This week:
$37.
This month :
$32.27
Other Primary facts
Market Cap:
5.87B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
142.54M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.29%
-13.54%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$51.54
$47.03
$31.92
$36.43
Medium risk (<10%) entry points
Buy Call
Sell Call
$45.56
Buy Put:
Sell Put:
$44.59
$37.89
$38.87
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
FFIN
Sharpe Ratio:
1.95%
Comparison:
FFIN, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 58.42% higher than the industry
& is -14.62% lower than the market/S&P 500 average
Average Returns/Yield of
FFIN
Daily returns:
0.06%
Weekly returns:
0.29%
Monthly returns:
1.15%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is 26.29% above industry average
Classification:
FFIN, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.99
Statistical test of Returns:
FFIN has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.50%
Weekly Volatility:
5.58%
Monthly Volatility:
11.16%
Yearly Volatility:
38.66%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.50%
Volatility in last five trading days has been -80.05% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.07%
Weekly VaR:
-11.33%
Monthly VaR:
-22.66%
How Much Can the price of
FFIN
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-78.51%
This translates to price declining to:
$33.64
This translates to price declining to:
$8.97
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
FFIN is a 59.96% riskier investment compared to the market/S&P 500 & is 37.04% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -12.64% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
FFIN
Beta in relation to market/S&P 500--0.88
Expected beta in 1 year's time:
0.736
Expected beta in 3 year's time:
1.04
Unlevered (debt free) Beta:
0.868
Beta in relation to Nasdaq (XNAS):
0.536
Beta in relation to all global stocks::
0.793
Beta Comparison & Analysis
Beta of competitors/peers::
1.321
Beta is -33.52% lower than peers
Average Industry Beta:
0.964
Beta is -8.89% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
8.43%
Sustainable growth rate is -7.67% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.046
Alpha is 297.78% above industry average alpha yield
Alpha is 294% higher than market/& is unsustainably high
Analysis of Cost of Capital of
FFIN
Equity cost of capital:
0.092
Equity cost of capital is -6.02% below industry mean WACC
Unlevered (without debt) cost of capital:
9.06%
Before-tax cost of debt:
27.67%
After-tax cost of debt:
21.86%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
21.86%
WACC is -20.06% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$3.55
Revenue growth rate per share of (3Y):
4
Annual revenue growth rate is 3.08% above the industry average
EPS:
$1.58
Expected Annual growth rate of EPS (3Y):
9.23%
Expected future EPS growth rate is -23.22% lower than the Banks�Regional industry
Free cash flow (FCF) per share:
$2.24
Balance sheet equity growth per share: 40.90%
Equity growth rate per share is 5.61% higher than the industry
Debt per share
$0.15
EBITDA per share
$2.03
Valuation Analysis Today of
FFIN
P/E Ratio:
25.9
P/E Ratio of Competitors/Peers:
13
P/E ratio is 99.24% higher than main peers & is 108.70% higher than the industry
Stock price/value with industry average P/E ratio: $19.61
FFIN is 112.85% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $30.87
Present value of the expected future dividends only: $11.79
P/S (Price to Sales ratio):
11.76
Price to sales ratio is 174.89% above the industry mean
P/B (Price to book value ratio):
4
Price to free cash flow: 18.67
-
Net income growth rate (3Y):
43.82%
Net income growth rate is -20.43% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 9.44%
Dividend yeild: 1.49%
Previous Dividend: $0.17
Previous adjusted dividend: $0.17
Previous Dividend: $0.62
Expected next dividend best case: $0.18
Expected next dividend worst case: $0.16
Average dividend payment (long-term): $0.14
Average dividend increase/decrease (growth rate) % per period: 3.71%
Expected next dividend payment date: 29/09/2022
Expected next dividend record date: 14/09/2022
-
Previous dividend payment date: 07/01/2022
Previous dividend record date: 16/06/2022
-
Dividend History:
2022-06-15--$0.17
2021-12-15--$0.15
2021-06-15--$0.15
2022-03-15--$0.15
2021-09-15--$0.15
2021-03-15--$0.13
Dividend growth rate is -84.25% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
1.41%
Net debt to equity ratio:
-38.74%
Debt to assets ratio:
0.16%
Net debt to assets ratio:
-4.33%
Debt-to-asset ratio is -99.91% below industry average
Ability to repay debt:
Interest coverage ratio:
49.65
Interest coverage ratio is 5890.45% more than industry average
Looking forward:
Debt growth rate:
-95.11%
Annual debt growth is -30130% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.525
Statistical significance of correlation:
FFIN has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is 4.88% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.501
Correlation of price movement with Nasdaq (^IXIC):
-0.008
Covariance of price movement with the market:
-0.011
Kurtosis
4.442
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.232
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
FFIN
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
100%
Effective Tax Rate:
16.16%
Effective tax rate is -24.98% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
15.22%
Return on equity (ROE) is 27.60% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.70%
Return on assets (ROA) is -26.14% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 13.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
361.4K
Each employee generates -5% less revenue than industry average revenue per employee
EBITDA generated per employee:
206.6K
Each employee generates -9% less EBITDA than industry average revenue per employee
Profit generated per employee:
161.9K
Each employee generates 14% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
59.6K
Each employee generates -28% less free cash flow than industry average revenue per employee
Assets/Capital per employee
5.0M
Each employee generates -28% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
FFIN
CREDIT ACCEPTANCE CORPORATION (XNAS:CACC)
TRILLION ENERGY INTERNATIONAL INC. (XCNQ:TCF)
Upstart Holdings Inc (XNAS:UPST)
PEOPLE'S UNITED FINANCIAL, INC. (XNAS:PBCTP)
Popular Inc (XNAS:BPOP)
NAVIENT CORPORATION (XNAS:JSM)
SLM CORPORATION (XNAS:SLM)
SOUTHSTATE CORPORATION (XNAS:SSB)
BOK FINANCIAL CORPORATION (XNAS:BOKF)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�21%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
505.97M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
126.24M
-
163.00M
166.00M
3.00M
-
-
386.74M
5.83M
13.12M
289.26M
-
226.62M
270.31M
43.70M
226.62M
Statement of Cash Flow
Date:
Period:
3.23M
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
4.31M
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
23.17M
Net Cash Provided by Operating Activities:
86.69M
Investments in PP&E:
- 3193.00K
Net Acquisitions:
-
Purchases of Investments:
- 551559.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
597.75M
6.50B
7.10B
-
-
-
-
150.17M
313.48M
2.98M
6.50B
-
-
6.97B
20.28B
13.31B
-
-
-
-
-
-
21.05M
-
21.05M
11.85B
11.83B
1.43M
1.02B
- 209582.0K
-
March 31, 2022 at 6:00:00 AM
-
1.49B
13.31B
13.00B
21.05M
- 576700.0K
211.27M
- 176350.00K
- 519836.00K
-
-
-
- 21385.00K
523.70M
502.32M
-
69.17M
597.75M
528.59M
86.69M
- 3193.00K
83.49M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
FFIN
2023
2024
2025
2026
2027
$44.40
$47.02
$49.79
$52.73
$55.84