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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Westamerica Bancorporation (XNAS:WABC) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
WABC
Name:
WESTAMERICA BANCORPORATION (XNAS:WABC)
Sector:
31.63M
Industry:
Banks�Regional
CEO:
Mr. David Payne
Total Employees:
640
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -122.50% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF WESTAMERICA BANCORPORATION(WABC) 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 ($) :
55.49
One Month Price Target:
$55.68
Six Month Price Target :
$56.62
Likely Price in One Year's Time:
Ticker:
$57.76
Likely Trading Range Today Under (Normal Volatility)
$55.29
Price Upper limit ($) :
$55.68
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$53.13
This week:
$50.22
This month :
$44.95
Other Primary facts
Market Cap:
1.47B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
26.91M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.11%
-9.9%
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:
$66.43
$61.46
$44.55
$49.52
Medium risk (<10%) entry points
Buy Call
Sell Call
$59.85
Buy Put:
Sell Put:
$58.78
$51.12
$52.20
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
WABC
Sharpe Ratio:
-0.58%
Comparison:
WABC, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -147.58% lower than the industry
& is -125.65% lower than the market/S&P 500 average
Average Returns/Yield of
WABC
Daily returns:
0.00%
Weekly returns:
-0.02%
Monthly returns:
-0.06%
Yearly returns:
10.91%
Comparison of returns:
Average annual returns/yield (last 3 years) is -107.10% below industry average
Classification:
WABC, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.27
Statistical test of Returns:
WABC has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.07%
Weekly Volatility:
4.62%
Monthly Volatility:
9.24%
Yearly Volatility:
32.01%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.36%
Volatility in last five trading days has been -82.80% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.25%
Weekly VaR:
-9.50%
Monthly VaR:
-18.99%
How Much Can the price of
WABC
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-17%
Worst case (decline):
-65.79%
This translates to price declining to:
$46.15
This translates to price declining to:
$18.98
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
WABC is a 34.05% riskier investment compared to the market/S&P 500 & is 14.84% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -27.67% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
WABC
Beta in relation to market/S&P 500--0.61
Expected beta in 1 year's time:
0.613
Expected beta in 3 year's time:
0.866
Unlevered (debt free) Beta:
0.597
Beta in relation to Nasdaq (XNAS):
0.43
Beta in relation to all global stocks::
0.661
Beta Comparison & Analysis
Beta of competitors/peers::
0.621
Beta is -2.22% lower than peers
Average Industry Beta:
0.964
Beta is -36.95% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
5.05%
Sustainable growth rate is -44.68% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.081
Alpha is -797.05% below industry average alpha yield
Alpha is -515% below the market average
Analysis of Cost of Capital of
WABC
Equity cost of capital:
0.073
Equity cost of capital is -25.01% below industry mean WACC
Unlevered (without debt) cost of capital:
7.18%
Before-tax cost of debt:
1.38%
After-tax cost of debt:
1.09%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.09%
WACC is -37.41% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$8.09
Revenue growth rate per share of (3Y):
2.13
Annual revenue growth rate is -75.09% below industry average
EPS:
$3.31
Expected Annual growth rate of EPS (3Y):
2.62%
Expected future EPS growth rate is -78.24% lower than the Banks�Regional industry
Free cash flow (FCF) per share:
$3.25
Balance sheet equity growth per share: 2.78%
Equity growth rate per share is -92.81% lower than the industry
Debt per share
$0.65
EBITDA per share
$5.19
Valuation Analysis Today of
WABC
P/E Ratio:
16.27
P/E Ratio of Competitors/Peers:
21.22
P/E ratio is -23.34% lower than main peers & is 31.09% higher than the industry
Stock price/value with industry average P/E ratio: $41.07
WABC is 35.10% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $40.92
Present value of the expected future dividends only: $23.67
P/S (Price to Sales ratio):
6.86
Price to sales ratio is 60.42% above the industry mean
P/B (Price to book value ratio):
2.13
Price to free cash flow: 17.06
-
Net income growth rate (3Y):
19.57%
Net income growth rate is -64.47% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 12.68%
Dividend yeild: 3.01%
Previous Dividend: $0.42
Previous adjusted dividend: $0.42
Previous Dividend: $1.67
Expected next dividend best case: $0.42
Expected next dividend worst case: $0.42
Average dividend payment (long-term): $0.41
Average dividend increase/decrease (growth rate) % per period: 0.24%
Expected next dividend payment date: 18/08/2022
Expected next dividend record date: 08/08/2022
Expected next dividend declaration date: 27/07/2022
Previous dividend payment date: 20/05/2022
Previous dividend record date: 05/09/2022
Previous dividend declaration date: 28/04/2022
Dividend History:
2022-05-06--$0.42
2021-11-05--$0.42
2021-04-30--$0.41
2022-02-04--$0.42
2021-07-30--$0.41
2021-02-05--$0.41
Dividend growth rate is -98.98% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
2.49%
Net debt to equity ratio:
-127.64%
Debt to assets ratio:
0.24%
Net debt to assets ratio:
-12.26%
Debt-to-asset ratio is -99.86% below industry average
Ability to repay debt:
Interest coverage ratio:
71.28
Interest coverage ratio is 8499.85% more than industry average
Looking forward:
Debt growth rate:
20.49%
Annual debt growth is 6370% higher 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:
0.526
Statistical significance of correlation:
WABC has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.501
Stock price is 5.07% 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:
0.01
Kurtosis
13.162
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
1.27
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
WABC
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
25.78%
Effective tax rate is 19.64% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
12.68%
Return on equity (ROE) is 6.29% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.22%
Return on assets (ROA) is -47.16% 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: 7.7 years
Stock based compensation to net income ratio:
0.38%
In-depth Efficiency Analysis
Revenue generated per employee:
340.1K
Each employee generates -10% less revenue than industry average revenue per employee
EBITDA generated per employee:
218.3K
Each employee generates -3% less EBITDA than industry average revenue per employee
Profit generated per employee:
139.0K
Each employee generates -2% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
49.4K
Each employee generates -41% less free cash flow than industry average revenue per employee
Assets/Capital per employee
8.0M
Each employee generates -41% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
WABC
PALOMAR HOLDINGS, INC. (XNAS:PLMR)
NBT BANCORP INC. (XNAS:NBTB)
EAGLE BANCORP, INC. (XNAS:EGBN)
NORTHWEST BANCSHARES, INC. (XNAS:NWBI)
PRA GROUP, INC. (XNAS:PRAA)
EHEALTH, INC. (XNAS:EHTH)
LAKELAND FINANCIAL CORPORATION (XNAS:LKFN)
CAPITOL FEDERAL FINANCIAL, INC. (XNAS:CFFN)
Pathward Financial, Inc. (XNAS:CASH)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�8%
Sell�8%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
217.66M
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:
-
-
-
59.17M
59.17M
-
-
-
174.89M
1.96M
17.86M
139.70M
-
88.98M
119.88M
30.91M
88.98M
Statement of Cash Flow
Date:
Period:
5.50M
Differed Income Tax :
-
Stock Based Compensation :
339.00K
Change in Working Capital :
4.00M
Accounts Receivables:
878.00K
Other Working Capital:
-
Other Non-Cash Items:
- 627.00K
Net Cash Provided by Operating Activities:
31.82M
Investments in PP&E:
- 198.00K
Net Acquisitions:
-
Purchases of Investments:
- 331191.00K
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
1.04B
4.62B
5.65B
34.64M
-
-
-
48.08M
121.67M
771.00K
4.94B
-
-
5.11B
12.41B
7.31B
-
124.44M
-
-
-
124.44M
17.46M
-
17.46M
6.50B
6.60B
472.44M
317.57M
- 88300.0K
-
March 31, 2022 at 6:00:00 AM
-
701.74M
7.31B
9.55B
141.90M
- 895695.0K
180.19M
65.65M
- 85551.00K
-
-
- 218.00K
- 11284.00K
- 29262.00K
- 40764.00K
-
- 94492.00K
1.04B
1.13B
31.82M
- 198.00K
31.63M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
WABC
2023
2024
2025
2026
2027
$67.93
$70.70
$73.59
$76.60
$79.72