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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Truist Financial Corporation (XNYS:TFC) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
TFC
Name:
Truist Financial Corporation (XNYS:TFC)
Sector:
- 188000.00K
Industry:
Banks�Regional
CEO:
Mr. Kelly King
Total Employees:
50,283
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 18.55% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF TRUIST FINANCIAL CORPORATION(TFC) 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 ($) :
46.49
One Month Price Target:
$46.78
Six Month Price Target :
$48.24
Likely Price in One Year's Time:
Ticker:
$49.99
Likely Trading Range Today Under (Normal Volatility)
$46.27
Price Upper limit ($) :
$46.73
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$43.71
This week:
$40.28
This month :
$34.07
Other Primary facts
Market Cap:
61.04B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
1.33B
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.24%
-19.1%
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:
$59.38
$53.50
$33.60
$39.48
Medium risk (<10%) entry points
Buy Call
Sell Call
$51.58
Buy Put:
Sell Put:
$50.33
$41.38
$42.65
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
TFC
Sharpe Ratio:
0.45%
Comparison:
TFC, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -63.74% lower than the industry
& is -80.46% lower than the market/S&P 500 average
Average Returns/Yield of
TFC
Daily returns:
0.02%
Weekly returns:
0.11%
Monthly returns:
0.44%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is -51.93% below industry average
Classification:
TFC, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.99
Statistical test of Returns:
TFC has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.92%
Weekly Volatility:
6.53%
Monthly Volatility:
13.06%
Yearly Volatility:
45.23%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.58%
Volatility in last five trading days has been -80.30% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.97%
Weekly VaR:
-13.36%
Monthly VaR:
-26.72%
How Much Can the price of
TFC
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-23%
Worst case (decline):
-92.55%
This translates to price declining to:
$35.62
This translates to price declining to:
$3.46
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
TFC is a 88.57% riskier investment compared to the market/S&P 500 & is 61.55% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 2.20% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
TFC
Beta in relation to market/S&P 500--1.12
Expected beta in 1 year's time:
0.745
Expected beta in 3 year's time:
1.054
Unlevered (debt free) Beta:
0.789
Beta in relation to Nasdaq (XNAS):
0.861
Beta in relation to all global stocks::
1.01
Beta Comparison & Analysis
Beta of competitors/peers::
0.998
Beta is 12.27% higher than peers
Average Industry Beta:
0.964
Beta is 16.22% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
5.72%
Sustainable growth rate is -37.30% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.056
Alpha is -580.71% below industry average alpha yield
Alpha is -355% below the market average
Analysis of Cost of Capital of
TFC
Equity cost of capital:
0.108
Equity cost of capital is 10.98% above industry mean WACC
Unlevered (without debt) cost of capital:
7.63%
Before-tax cost of debt:
1.88%
After-tax cost of debt:
1.49%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.49%
WACC is -11.62% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$16.66
Revenue growth rate per share of (3Y):
0.95
Annual revenue growth rate is -64.48% below industry average
EPS:
$4.48
Expected Annual growth rate of EPS (3Y):
5.94%
Expected future EPS growth rate is -50.63% lower than the Banks�Regional industry
Free cash flow (FCF) per share:
$5.47
Balance sheet equity growth per share: 18.76%
Equity growth rate per share is -51.56% lower than the industry
Debt per share
$25.46
EBITDA per share
$7.44
Valuation Analysis Today of
TFC
P/E Ratio:
10.54
P/E Ratio of Competitors/Peers:
12.21
P/E ratio is -13.66% lower than main peers & is -15.07% lower than the industry
Stock price/value with industry average P/E ratio: $55.59
TFC is -16.37% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $31.25
Present value of the expected future dividends only: $19.04
P/S (Price to Sales ratio):
2.79
Price to sales ratio is -34.76% below the industry mean
P/B (Price to book value ratio):
0.95
Price to free cash flow: 8.49
Price to free cash flow ratio is -54.74% lower than the industry
Net income growth rate (3Y):
14.16%
Net income growth rate is -74.29% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 9.99%
Dividend yeild: 4.13%
Previous Dividend: $0.48
Previous adjusted dividend: $0.48
Previous Dividend: $1.92
Expected next dividend best case: $0.49
Expected next dividend worst case: $0.47
Average dividend payment (long-term): $0.46
Average dividend increase/decrease (growth rate) % per period: 0.67%
Expected next dividend payment date: 30/08/2022
Expected next dividend record date: 08/11/2022
-
Previous dividend payment date: 06/01/2022
Previous dividend record date: 13/05/2022
-
Dividend History:
2022-05-12--$0.48
2021-11-10--$0.48
2021-05-13--$0.45
2022-02-10--$0.48
2021-08-12--$0.48
2021-02-11--$0.45
Dividend growth rate is -97.16% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
51.94%
Net debt to equity ratio:
15.07%
Debt to assets ratio:
6.21%
Net debt to assets ratio:
1.80%
Debt-to-asset ratio is -96.27% below industry average
Ability to repay debt:
Interest coverage ratio:
13.47
Interest coverage ratio is 1524.64% more than industry average
Looking forward:
Debt growth rate:
-12.66%
Annual debt growth is -4097% lower than industry average debt growth rate
Debt repayment rate in last quarter: 4.79%
Analysis of Key Statistics
Correlation of price movement with the market:
0.701
Statistical significance of correlation:
TFC has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is 40.02% 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):
0.024
Covariance of price movement with the market:
0.041
Kurtosis
7.924
Returns have a significant 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:
-0.049
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
TFC
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
0.26%
Operating profit margin is -99.27% lower than the industry
Net Profit Margin Ratio:
100%
Effective Tax Rate:
19.39%
Effective tax rate is -10.00% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9.81%
Return on equity (ROE) is -17.77% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.17%
Return on assets (ROA) is -49.12% lower than the industry
Financial Leverage:
1.1x
Current Ratio:
5.66
Current ratio is -90.56% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 3.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
439.6K
Each employee generates 16% more revenue than industry average revenue per employee
EBITDA generated per employee:
196.3K
Each employee generates -13% less EBITDA than industry average revenue per employee
Profit generated per employee:
126.8K
Each employee generates -10% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 3.7K
Each employee generates -104% less free cash flow than industry average revenue per employee
Assets/Capital per employee
3.8M
Each employee generates -104% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
TFC
THE PNC FINANCIAL SERVICES GROUP, INC. (XNYS:PNC)
Chubb Ltd (XNYS:CB)
THE BANK OF NOVA SCOTIA (XNYS:BNS)
WESTPAC BANKING CORPORATION (XNYS:WBK)
U.S. BANCORP (XNYS:USB)
BAM
CAPITAL ONE FINANCIAL CORPORATION (XNYS:COF)
S&P Global Inc. (XNYS:SPGI)
Mitsubishi UFJ Financial Group, Inc. (XNYS:MUFG)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
22.10B
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:
-
5.33B
-
8.54B
8.85B
312.00M
- 1688000.00K
447.00M
13.64B
733.00M
1.22B
9.87B
58.00M
6.38B
7.92B
1.54B
6.38B
Statement of Cash Flow
Date:
Period:
332.00M
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
- 1936000.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
- 188000.00K
Investments in PP&E:
-
Net Acquisitions:
- 488000.00K
Purchases of Investments:
- 7219000.00K
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
29.12B
84.75B
113.88B
-
-
- 84753000.00K
29.12B
3.66B
26.28B
6.71B
152.34B
-
-
188.99B
703.84B
543.98B
-
5.15B
-
-
-
5.15B
33.77B
6.54B
33.77B
507.56B
478.94B
6.66B
23.69B
- 6535000.0K
34.54B
March 31, 2022 at 6:00:00 AM
-
65.02B
543.96B
237.09B
38.92B
9.8B
3.13B
4.55B
- 34000.00K
- 1699000.00K
-
-
- 637000.00K
11.39B
9.05B
-
8.83B
29.12B
20.30B
- 188000.00K
-
- 188000.00K
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
TFC
2023
2024
2025
2026
2027
$58.23
$62.61
$67.33
$72.39
$77.84