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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Valley National Bancorp (XNAS:VLY) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
VLY
Name:
VALLEY NATIONAL BANCORP (XNAS:VLY)
Sector:
473.25M
Industry:
Banks�Regional
CEO:
Mr. Ira Robbins
Total Employees:
3,370
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -169.00% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF VALLEY NATIONAL BANCORP(VLY) 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 ($) :
11.51
One Month Price Target:
$11.58
Six Month Price Target :
$11.95
Likely Price in One Year's Time:
Ticker:
$12.39
Likely Trading Range Today Under (Normal Volatility)
$11.46
Price Upper limit ($) :
$11.57
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$10.84
This week:
$10.02
This month :
$8.52
Other Primary facts
Market Cap:
5.71B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
506.34M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.2%
-14.29%
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:
$14.61
$13.19
$8.41
$9.83
Medium risk (<10%) entry points
Buy Call
Sell Call
$12.73
Buy Put:
Sell Put:
$12.42
$10.29
$10.60
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
VLY
Sharpe Ratio:
1.12%
Comparison:
VLY, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -8.84% lower than the industry
& is -50.87% lower than the market/S&P 500 average
Average Returns/Yield of
VLY
Daily returns:
0.04%
Weekly returns:
0.20%
Monthly returns:
0.81%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is -10.48% below industry average
Classification:
VLY, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.42
Statistical test of Returns:
VLY has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.84%
Weekly Volatility:
6.36%
Monthly Volatility:
12.72%
Yearly Volatility:
44.06%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.83%
Volatility in last five trading days has been -70.97% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.80%
Weekly VaR:
-12.97%
Monthly VaR:
-25.94%
How Much Can the price of
VLY
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-22%
Worst case (decline):
-89.86%
This translates to price declining to:
$8.92
This translates to price declining to:
$1.17
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
VLY is a 83.10% riskier investment compared to the market/S&P 500 & is 56.86% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -0.43% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
VLY
Beta in relation to market/S&P 500--1.14
Expected beta in 1 year's time:
0.69
Expected beta in 3 year's time:
0.976
Unlevered (debt free) Beta:
0.945
Beta in relation to Nasdaq (XNAS):
0.516
Beta in relation to all global stocks::
0.825
Beta Comparison & Analysis
Beta of competitors/peers::
1.138
Beta is -0.05% lower than peers
Average Industry Beta:
0.964
Beta is 18.07% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
6.06%
Sustainable growth rate is -33.57% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.012
Alpha is -201.36% below industry average alpha yield
Alpha is -75% below the market average
Analysis of Cost of Capital of
VLY
Equity cost of capital:
0.109
Equity cost of capital is 12.23% above industry mean WACC
Unlevered (without debt) cost of capital:
9.09%
Before-tax cost of debt:
4.96%
After-tax cost of debt:
3.92%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.92%
WACC is -7.80% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$2.73
Revenue growth rate per share of (3Y):
1.14
Annual revenue growth rate is -56.07% below industry average
EPS:
$1.12
Expected Annual growth rate of EPS (3Y):
8.37%
Expected future EPS growth rate is -30.37% lower than the Banks�Regional industry
Free cash flow (FCF) per share:
$2.38
Balance sheet equity growth per share: 2.00%
Equity growth rate per share is -94.82% lower than the industry
Debt per share
$2.78
EBITDA per share
$1.63
Valuation Analysis Today of
VLY
P/E Ratio:
11.34
P/E Ratio of Competitors/Peers:
10.67
P/E ratio is 6.25% higher than main peers & is -8.61% lower than the industry
Stock price/value with industry average P/E ratio: $13.90
VLY is -17.18% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $15.47
Present value of the expected future dividends only: $4.02
P/S (Price to Sales ratio):
4.22
Price to sales ratio is -1.35% below the industry mean
P/B (Price to book value ratio):
1.14
Price to free cash flow: 4.84
-
Net income growth rate (3Y):
48.71%
Net income growth rate is -11.56% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 0.67%
Dividend yeild: 3.82%
Previous Dividend: $0.11
Previous adjusted dividend: $0.11
Previous Dividend: $0.44
-
-
Average dividend payment (long-term): $0.11
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 29/09/2022
Expected next dividend record date: 13/09/2022
-
Previous dividend payment date: 07/01/2022
Previous dividend record date: 15/06/2022
-
Dividend History:
2022-06-14--$0.11
2021-12-14--$0.11
2021-06-14--$0.11
2022-03-14--$0.11
2021-09-14--$0.11
2021-03-12--$0.11
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
27.65%
Net debt to equity ratio:
28.35%
Debt to assets ratio:
3.24%
Net debt to assets ratio:
3.32%
Debt-to-asset ratio is -98.06% below industry average
Ability to repay debt:
Interest coverage ratio:
7.64
Interest coverage ratio is 822.15% more than industry average
Looking forward:
Debt growth rate:
-32.00%
Annual debt growth is -10205% 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:
0.487
Statistical significance of correlation:
VLY has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is -2.69% 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):
0.02
Covariance of price movement with the market:
0.032
Kurtosis
3.742
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:
0.204
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
VLY
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
26.01%
Effective tax rate is 20.69% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9.26%
Return on equity (ROE) is -22.42% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.08%
Return on assets (ROA) is -53.00% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
2.41
Current ratio is -95.98% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 2.0 years
Stock based compensation to net income ratio:
1.54%
In-depth Efficiency Analysis
Revenue generated per employee:
409.9K
Each employee generates 8% more revenue than industry average revenue per employee
EBITDA generated per employee:
244.9K
Each employee generates 8% more EBITDA than industry average revenue per employee
Profit generated per employee:
140.0K
Each employee generates -1% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
140.4K
Each employee generates 69% more free cash flow than industry average revenue per employee
Assets/Capital per employee
558.1K
Each employee generates 69% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
VLY
PACWEST BANCORP (XNAS:PACW)
SLM CORPORATION (XNAS:SLM)
KL ACQUISITION UNT (XNAS:KLAQU)
SOUTHSTATE CORPORATION (XNAS:SSB)
WINTRUST FINANCIAL CORPORATION (XNAS:WTFC)
ACE CONVERGENCE ACQUISITION UNT (XNAS:ACEVU)
Bank Ozk (XNAS:OZK)
GLACIER BANCORP, INC. (XNYS:GBCI)
HUDSON EXECUTIVE INVESTMENT UNT (XNAS:HIIIU)
Current Analyst Ratings
Strong buy�0%
Buy�13%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.38B
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:
-
-
-
313.42M
313.42M
-
-
14.75M
1.34B
107.98M
78.74M
825.30M
-
471.69M
641.75M
166.89M
471.69M
Statement of Cash Flow
Date:
Period:
21.83M
Differed Income Tax :
-
Stock Based Compensation :
7.26M
Change in Working Capital :
350.18M
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
496.00M
Investments in PP&E:
- 22749.00K
Net Acquisitions:
-
Purchases of Investments:
- 560462.00K
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
730.92M
1.02B
1.75B
102.67M
-
-
1.85B
337.48M
1.47B
74.88M
3.12B
-
- 3119714.00K
1.88B
43.58B
43.55B
-
766.62M
-
-
-
766.62M
1.41B
36.28B
37.69B
-
38.46B
148.48M
945.23M
- 56098.0K
4.06B
March 31, 2022 at 6:00:00 AM
-
5.10B
43.55B
4.13B
2.18B
1.4B
214.72M
- 1216806.00K
- 1585293.00K
-
95.00K
- 23627.00K
- 3172.00K
- 203006.00K
- 229710.00K
-
- 1319000.00K
730.92M
2.05B
496.00M
- 22749.00K
473.25M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
VLY
2023
2024
2025
2026
2027
$14.42
$15.53
$16.71
$17.99
$19.37