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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Veritex Holdings, Inc. (XNAS:VBTX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
VBTX
Name:
VERITEX HOLDINGS, INC. (XNAS:VBTX)
Sector:
67.09M
Industry:
Banks�Regional
CEO:
Mr. C. Malcolm Holland
Total Employees:
690
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 531.25% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF VERITEX HOLDINGS, INC.(VBTX) 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 ($) :
29.89
One Month Price Target:
$30.13
Six Month Price Target :
$31.34
Likely Price in One Year's Time:
Ticker:
$32.79
Likely Trading Range Today Under (Normal Volatility)
$29.75
Price Upper limit ($) :
$30.07
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$27.95
This week:
$25.56
This month :
$21.24
Other Primary facts
Market Cap:
1.57B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
53.98M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
13.26%
-24.21%
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:
$38.87
$34.74
$20.91
$25.04
Medium risk (<10%) entry points
Buy Call
Sell Call
$33.40
Buy Put:
Sell Put:
$32.51
$26.37
$27.27
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
VBTX
Sharpe Ratio:
1.92%
Comparison:
VBTX, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 56.37% higher than the industry
& is -15.73% lower than the market/S&P 500 average
Average Returns/Yield of
VBTX
Daily returns:
0.07%
Weekly returns:
0.35%
Monthly returns:
1.40%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is 54.10% above industry average
Classification:
VBTX, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.33
Statistical test of Returns:
VBTX has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.19%
Weekly Volatility:
7.13%
Monthly Volatility:
14.25%
Yearly Volatility:
49.37%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.90%
Volatility in last five trading days has been -71.78% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.47%
Weekly VaR:
-14.48%
Monthly VaR:
-28.95%
How Much Can the price of
VBTX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-25%
Worst case (decline):
>85%
This translates to price declining to:
$22.48
This translates to price declining to:
$4.48
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
VBTX is a 104.36% riskier investment compared to the market/S&P 500 & is 75.07% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 11.55% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
VBTX
Beta in relation to market/S&P 500--1.44
Expected beta in 1 year's time:
0.821
Expected beta in 3 year's time:
1.161
Unlevered (debt free) Beta:
0.928
Beta in relation to Nasdaq (XNAS):
0.885
Beta in relation to all global stocks::
1.044
Beta Comparison & Analysis
Beta of competitors/peers::
0.693
Beta is 107.91% higher than peers
Average Industry Beta:
0.964
Beta is 49.57% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.96%
Sustainable growth rate is -12.81% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.038
Alpha is 226.78% above industry average alpha yield
Alpha is 241% higher than market/& is unsustainably high
Analysis of Cost of Capital of
VBTX
Equity cost of capital:
0.130
Equity cost of capital is 33.55% above industry mean WACC
Unlevered (without debt) cost of capital:
8.38%
Before-tax cost of debt:
3.29%
After-tax cost of debt:
2.60%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.60%
WACC is 4.62% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$6.32
Revenue growth rate per share of (3Y):
1.11
Annual revenue growth rate is -4.96% below industry average
EPS:
$2.78
Expected Annual growth rate of EPS (3Y):
17.44%
Expected future EPS growth rate is 45.09% higher than the Banks�Regional industry
Free cash flow (FCF) per share:
$3.43
-
-
Debt per share
$18.63
EBITDA per share
$4.20
Valuation Analysis Today of
VBTX
P/E Ratio:
10.9
P/E Ratio of Competitors/Peers:
16.87
P/E ratio is -35.37% lower than main peers & is -12.14% lower than the industry
Stock price/value with industry average P/E ratio: $34.50
VBTX is -13.35% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $29.28
Present value of the expected future dividends only: $11.00
P/S (Price to Sales ratio):
4.73
Price to sales ratio is 10.50% above the industry mean
P/B (Price to book value ratio):
1.11
Price to free cash flow: 8.71
Price to free cash flow ratio is -54.94% lower than the industry
Net income growth rate (3Y):
71.90%
Net income growth rate is 30.56% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 7.02%
Dividend yeild: 2.68%
Previous Dividend: $0.20
Previous adjusted dividend: $0.20
Previous Dividend: $0.80
Expected next dividend best case: $0.22
Expected next dividend worst case: $0.18
Average dividend payment (long-term): $0.18
Average dividend increase/decrease (growth rate) % per period: 5.36%
Expected next dividend payment date: 25/08/2022
Expected next dividend record date: 08/11/2022
Expected next dividend declaration date: 25/07/2022
Previous dividend payment date: 27/05/2022
Previous dividend record date: 13/05/2022
Previous dividend declaration date: 26/04/2022
Dividend History:
2022-05-12--$0.20
2021-11-09--$0.20
2021-05-05--$0.17
2022-02-10--$0.20
2021-08-04--$0.20
2021-02-03--$0.17
Dividend growth rate is -77.25% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
69.44%
Net debt to equity ratio:
31.35%
Debt to assets ratio:
9.62%
Net debt to assets ratio:
4.34%
Debt-to-asset ratio is -94.22% below industry average
Ability to repay debt:
Interest coverage ratio:
6.85
Interest coverage ratio is 726.91% more than industry average
Looking forward:
Debt growth rate:
-3.38%
Annual debt growth is -1167% 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:
0.647
Statistical significance of correlation:
VBTX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is 29.13% 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):
0.034
Covariance of price movement with the market:
0.063
Kurtosis
11.261
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:
-1.058
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
VBTX
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
20.23%
Effective tax rate is -6.10% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9.76%
Return on equity (ROE) is -18.22% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.35%
Return on assets (ROA) is -41.36% lower than the industry
Financial Leverage:
1.1x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 3.0 years
Stock based compensation to net income ratio:
2.35%
In-depth Efficiency Analysis
Revenue generated per employee:
494.8K
Each employee generates 30% more revenue than industry average revenue per employee
EBITDA generated per employee:
328.2K
Each employee generates 45% more EBITDA than industry average revenue per employee
Profit generated per employee:
204.7K
Each employee generates 45% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
97.2K
Each employee generates 17% more free cash flow than industry average revenue per employee
Assets/Capital per employee
2.7M
Each employee generates 17% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
VBTX
EAGLE BANCORP, INC. (XNAS:EGBN)
NORTHWEST BANCSHARES, INC. (XNAS:NWBI)
PRA GROUP, INC. (XNAS:PRAA)
PALOMAR HOLDINGS, INC. (XNAS:PLMR)
WESTAMERICA BANCORPORATION (XNAS:WABC)
NBT BANCORP INC. (XNAS:NBTB)
CAPITOL FEDERAL FINANCIAL, INC. (XNAS:CFFN)
LAKELAND FINANCIAL CORPORATION (XNAS:LKFN)
HOPE BANCORP, INC. (XNAS:HOPE)
Current Analyst Ratings
Strong buy�8%
Buy�4%
Hold�4%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
341.39M
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:
-
-
-
111.36M
116.98M
5.62M
-
-
321.24M
33.05M
16.34M
226.49M
-
141.27M
177.10M
35.83M
141.27M
Statement of Cash Flow
Date:
Period:
4.38M
Differed Income Tax :
-
Stock Based Compensation :
3.32M
Change in Working Capital :
24.60M
Accounts Receivables:
-
Other Working Capital:
- 447.00K
Other Non-Cash Items:
2.46M
Net Cash Provided by Operating Activities:
68.22M
Investments in PP&E:
- 1130.00K
Net Acquisitions:
-
Purchases of Investments:
- 271649.00K
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
551.57M
1.06B
1.61B
-
-
-
-
109.14M
404.45M
63.99M
1.26B
-
-
1.84B
12.29B
10.45B
105.55M
-
-
-
-
-
1.01B
-
1.01B
10.01B
9.01B
605.00K
298.83M
19.0M
-
March 31, 2022 at 6:00:00 AM
-
1.45B
10.45B
2.32B
1.01B
454.0M
35.38M
- 327380.00K
- 564784.00K
-
153.87M
-
- 9913.00K
524.40M
668.36M
-
171.79M
551.57M
379.78M
68.22M
- 1130.00K
67.09M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
VBTX
2023
2024
2025
2026
2027
$32.95
$47.34
$51.92
$56.95
$62.47