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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Towne Bank (XNAS:TOWN) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
TOWN
Name:
TOWNE BANK (XNAS:TOWN)
Sector:
149.09M
Industry:
Banks�Regional
CEO:
Mr. J. Morgan Davis
Total Employees:
2,617
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 390.34% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF TOWNE BANK(TOWN) 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 ($) :
28.09
One Month Price Target:
$28.24
Six Month Price Target :
$29.02
Likely Price in One Year's Time:
Ticker:
$29.95
Likely Trading Range Today Under (Normal Volatility)
$27.97
Price Upper limit ($) :
$28.23
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$26.58
This week:
$24.7
This month :
$21.32
Other Primary facts
Market Cap:
2.01B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
72.72M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.52%
-15.41%
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:
$35.12
$31.90
$21.06
$24.28
Medium risk (<10%) entry points
Buy Call
Sell Call
$30.85
Buy Put:
Sell Put:
$30.17
$25.32
$26.01
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
TOWN
Sharpe Ratio:
0.97%
Comparison:
TOWN, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -21.02% lower than the industry
& is -57.43% lower than the market/S&P 500 average
Average Returns/Yield of
TOWN
Daily returns:
0.03%
Weekly returns:
0.17%
Monthly returns:
0.69%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is -24.17% below industry average
Classification:
TOWN, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.53
Statistical test of Returns:
TOWN has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.64%
Weekly Volatility:
5.91%
Monthly Volatility:
11.81%
Yearly Volatility:
40.91%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.15%
Volatility in last five trading days has been -94.23% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.39%
Weekly VaR:
-12.05%
Monthly VaR:
-24.10%
How Much Can the price of
TOWN
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-21%
Worst case (decline):
-83.49%
This translates to price declining to:
$22.21
This translates to price declining to:
$4.64
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
TOWN is a 70.11% riskier investment compared to the market/S&P 500 & is 45.73% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -7.55% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
TOWN
Beta in relation to market/S&P 500--0.98
Expected beta in 1 year's time:
0.689
Expected beta in 3 year's time:
0.975
Unlevered (debt free) Beta:
0.796
Beta in relation to Nasdaq (XNAS):
0.489
Beta in relation to all global stocks::
0.917
Beta Comparison & Analysis
Beta of competitors/peers::
1.11
Beta is -11.32% lower than peers
Average Industry Beta:
0.964
Beta is 2.16% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
9.24%
Sustainable growth rate is 1.22% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.016
Alpha is -239.66% below industry average alpha yield
Alpha is -103% below the market average
Analysis of Cost of Capital of
TOWN
Equity cost of capital:
0.099
Equity cost of capital is 1.46% above industry mean WACC
Unlevered (without debt) cost of capital:
8.00%
Before-tax cost of debt:
6.87%
After-tax cost of debt:
5.43%
Overall debt rating:
Lowest medium B grade (second lowest)
Weighted average cost of capital (WACC):
5.43%
WACC is -15.17% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$9.10
Revenue growth rate per share of (3Y):
1.09
Annual revenue growth rate is -14.51% below industry average
EPS:
$2.65
Expected Annual growth rate of EPS (3Y):
15.45%
Expected future EPS growth rate is 28.52% higher than the Banks�Regional industry
Free cash flow (FCF) per share:
$7.68
Balance sheet equity growth per share: 20.99%
Equity growth rate per share is -45.80% lower than the industry
Debt per share
$7.59
EBITDA per share
$4.24
Valuation Analysis Today of
TOWN
P/E Ratio:
11.16
P/E Ratio of Competitors/Peers:
11.46
P/E ratio is -2.68% lower than main peers & is -10.10% lower than the industry
Stock price/value with industry average P/E ratio: $32.88
TOWN is -14.58% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $29.00
Present value of the expected future dividends only: $11.69
P/S (Price to Sales ratio):
3.09
Price to sales ratio is -27.83% below the industry mean
P/B (Price to book value ratio):
1.09
Price to free cash flow: 3.66
-
Net income growth rate (3Y):
58.03%
Net income growth rate is 5.36% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 7.70%
Dividend yeild: 2.95%
Previous Dividend: $0.23
Previous adjusted dividend: $0.23
Previous Dividend: $0.83
Expected next dividend best case: $0.24
Expected next dividend worst case: $0.22
Average dividend payment (long-term): $0.19
Average dividend increase/decrease (growth rate) % per period: 2.61%
Expected next dividend payment date: 10/10/2022
Expected next dividend record date: 28/09/2022
-
Previous dividend payment date: 07/12/2022
Previous dividend record date: 30/06/2022
-
Dividend History:
2022-06-29--$0.23
2021-12-29--$0.20
2021-06-29--$0.20
2022-03-29--$0.20
2021-09-29--$0.20
2021-03-29--$0.18
Dividend growth rate is -88.92% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
29.63%
Net debt to equity ratio:
-129.67%
Debt to assets ratio:
3.31%
Net debt to assets ratio:
-14.49%
Debt-to-asset ratio is -98.01% below industry average
Ability to repay debt:
Interest coverage ratio:
8.13
Interest coverage ratio is 880.49% more than industry average
Looking forward:
Debt growth rate:
-42.56%
Annual debt growth is -13538% lower than industry average debt growth rate
Debt repayment rate in last quarter: 15.47%
Analysis of Key Statistics
Correlation of price movement with the market:
0.479
Statistical significance of correlation:
TOWN has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is -4.33% less 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):
0.028
Covariance of price movement with the market:
0.043
Kurtosis
5.256
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:
0.28
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
TOWN
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
19.93%
Effective tax rate is -7.50% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.31%
Return on equity (ROE) is -13.60% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.15%
Return on assets (ROA) is -50.02% 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: 5.1 years
Stock based compensation to net income ratio:
0.55%
In-depth Efficiency Analysis
Revenue generated per employee:
252.9K
Each employee generates -33% less revenue than industry average revenue per employee
EBITDA generated per employee:
117.8K
Each employee generates -48% less EBITDA than industry average revenue per employee
Profit generated per employee:
73.4K
Each employee generates -48% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
57.0K
Each employee generates -31% less free cash flow than industry average revenue per employee
Assets/Capital per employee
1.2M
Each employee generates -31% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
TOWN
BANCFIRST CORPORATION (XNAS:BANF)
WESBANCO, INC. (XNAS:WSBC)
FIRST MERCHANTS CORPORATION (XNAS:FRME)
FIRST FINANCIAL BANCORP. (XNAS:FFBC)
WASHINGTON FEDERAL, INC. (XNAS:WAFD)
B. RILEY FINANCIAL, INC. (XNAS:RILY)
VICTORY CAPITAL HOLDINGS, INC. (XNAS:VCTR)
FIRST MIDWEST BANCORP, INC. (XNAS:FMBI)
SANDY SPRING BANCORP, INC. (XNAS:SASR)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
661.90M
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:
-
-
-
285.26M
299.92M
14.66M
-
-
439.52M
37.94M
28.92M
308.28M
-
191.97M
248.10M
49.45M
191.97M
Statement of Cash Flow
Date:
Period:
7.30M
Differed Income Tax :
750.00K
Stock Based Compensation :
1.06M
Change in Working Capital :
- 17946.00K
Accounts Receivables:
- 1720.00K
Other Working Capital:
-
Other Non-Cash Items:
123.12M
Net Cash Provided by Operating Activities:
160.54M
Investments in PP&E:
- 11445.00K
Net Acquisitions:
-
Purchases of Investments:
- 471424.00K
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
2.97B
1.85B
4.81B
-
-
-
-
277.76M
457.16M
47.56M
2.29B
-
-
3.07B
19.74B
16.67B
-
-
-
-
-
-
551.95M
-
551.95M
15.34B
14.79B
121.23M
747.61M
- 56712.0K
1.05B
March 31, 2022 at 6:00:00 AM
-
1.86B
16.65B
4.13B
551.95M
- 2415049.0K
59.15M
- 395480.00K
- 819202.00K
- 100980.00K
-
-
- 14782.00K
444.79M
329.03M
-
- 329634.00K
2.97B
3.30B
160.54M
- 11445.00K
149.09M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
TOWN
2023
2024
2025
2026
2027
$36.02
$38.40
$40.94
$43.65
$46.54