TSX:LB

Stock Analysis Report

Laurentian Bank of Canada

Executive Summary

Laurentian Bank of Canada, together with its subsidiaries, provides various banking services to individuals, small and medium-sized enterprises, and institutional customers in Canada and the United States.


Snowflake Analysis

Established dividend payer with adequate balance sheet.


Similar Companies

Share Price & News

How has Laurentian Bank of Canada's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LB's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.2%

LB

7.0%

CA Banks

7.1%

CA Market


1 Year Return

-25.9%

LB

-22.9%

CA Banks

-25.3%

CA Market

Return vs Industry: LB underperformed the Canadian Banks industry which returned -22.9% over the past year.

Return vs Market: LB matched the Canadian Market which returned -25.3% over the past year.


Shareholder returns

LBIndustryMarket
7 Day1.2%7.0%7.1%
30 Day-27.9%-22.8%-24.1%
90 Day-34.3%-25.1%-26.7%
1 Year-22.6%-25.9%-19.5%-22.9%-22.9%-25.3%
3 Year-40.3%-48.7%-12.2%-22.1%-15.6%-23.4%
5 Year-19.1%-36.5%18.7%-2.8%-3.2%-17.5%

Price Volatility Vs. Market

How volatile is Laurentian Bank of Canada's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Laurentian Bank of Canada undervalued compared to its fair value and its price relative to the market?

8.41x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LB (CA$30.05) is trading above our estimate of fair value (CA$26.48)

Significantly Below Fair Value: LB is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: LB is poor value based on its PE Ratio (8.4x) compared to the Banks industry average (7.7x).

PE vs Market: LB is good value based on its PE Ratio (8.4x) compared to the Canadian market (10.6x).


Price to Earnings Growth Ratio

PEG Ratio: LB is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: LB is good value based on its PB Ratio (0.6x) compared to the CA Banks industry average (1x).


Next Steps

Future Growth

How is Laurentian Bank of Canada forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

7.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LB's forecast earnings growth (7.3% per year) is above the savings rate (1.4%).

Earnings vs Market: LB's earnings (7.3% per year) are forecast to grow slower than the Canadian market (7.8% per year).

High Growth Earnings: LB's earnings are forecast to grow, but not significantly.

Revenue vs Market: LB's revenue (3.2% per year) is forecast to grow slower than the Canadian market (3.9% per year).

High Growth Revenue: LB's revenue (3.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LB's Return on Equity is forecast to be low in 3 years time (6.8%).


Next Steps

Past Performance

How has Laurentian Bank of Canada performed over the past 5 years?

10.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LB has high quality earnings.

Growing Profit Margin: LB's current net profit margins (16.6%) are lower than last year (19.7%).


Past Earnings Growth Analysis

Earnings Trend: LB's earnings have grown by 10.4% per year over the past 5 years.

Accelerating Growth: LB's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LB had negative earnings growth (-21%) over the past year, making it difficult to compare to the Banks industry average (5.3%).


Return on Equity

High ROE: LB's Return on Equity (6.4%) is considered low.


Next Steps

Financial Health

How is Laurentian Bank of Canada's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: LB has a low level of unsold assets or inventory.

Debt Coverage by Assets: LB's debt is not covered by short term assets (assets are 0.6x debt).


Financial Institutions Analysis

Asset Level: LB's level of assets compared to its equity is moderate.

Allowance for Bad Loans: LB has a low allowance for bad loans.

Low Risk Liabilities: LB's liabilities are made up of primarily low risk sources of funding.

Loan Level: LB has an acceptable proportion of non-loan assets held.

Low Risk Deposits: LB has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: LB has an appropriate level of bad loans (0.56%)


Next Steps

Dividend

What is Laurentian Bank of Canada's current dividend yield, its reliability and sustainability?

8.92%

Current Dividend Yield


Upcoming Dividend Payment

TodayMar 28 2020Ex Dividend DateMar 31 2020Dividend Pay DateMay 01 202031 days from Ex DividendBuy in the next 2 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: LB's dividend (8.92%) is higher than the bottom 25% of dividend payers in the Canadian market (2.75%).

High Dividend: LB's dividend (8.92%) is in the top 25% of dividend payers in the Canadian market (8.79%)


Stability and Growth of Payments

Stable Dividend: LB's dividends per share have been stable in the past 10 years.

Growing Dividend: LB's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (73.9%), LB's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.3yrs

Average management tenure


CEO

François Desjardins (48yo)

4.33s

Tenure

CA$3,090,889

Compensation

Mr. François Desjardins has been the Chief Executive Officer and President at Laurentian Bank of Canada since November 1, 2015. Mr. Desjardins served as the Chief Operating Officer of Laurentian Bank of Ca ...


CEO Compensation Analysis

Compensation vs Market: François's total compensation ($USD2.20M) is about average for companies of similar size in the Canadian market ($USD1.69M).

Compensation vs Earnings: François's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
François Desjardins
President4.33yrsCA$3.09m0.028% CA$381.3k
François Laurin
Executive VP of Finance4.58yrsCA$1.35m0.0062% CA$83.2k
Deborah Rose
Executive VP1.75yrsCA$1.45m0.0045% CA$61.2k
Stéphane Therrien
Executive Vice President of Personal & Commercial Banking4.75yrsCA$1.46m0.0092% CA$123.6k
William Mason
Executive VP & Chief Risk Officer1.75yrsCA$1.34m0.017% CA$223.9k
André Lopresti
Senior VP & Chief Accountantno datano data0.00095% CA$12.8k
Susan Cohen
Director of Investor Relationsno datano datano data
Emmanuela Fleurandin
Senior Legal Counsel & Assistant Secretaryno datano datano data
Helene Soulard
Assistant Vice President of Communicationsno datano datano data
Rick Lane
SVP of Real Estate Financing and VP of Real Estate Financing - Ontario & Western Canadano datano datano data

4.3yrs

Average Tenure

Experienced Management: LB's management team is considered experienced (4.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
François Desjardins
President4.33yrsCA$3.09m0.028% CA$381.3k
Michael Boychuk
Independent Director6.58yrsCA$146.50k0.0033% CA$44.7k
Sonia Baxendale
Independent Director3.58yrsCA$134.45k0.0054% CA$72.5k
Michael Mueller
Independent Chairman of the Board0.92yrCA$204.24kno data
David Mowat
Independent Director0.58yrCA$19.45kno data
Andrea Bolger
Independent Director0.58yrCA$19.45k0.0035% CA$47.0k
Lise Bastarache
Independent Director14yrsCA$119.00k0.0097% CA$130.3k
Susan Jenah
Independent Director5.25yrsCA$123.25k0.0029% CA$39.0k
Michelle Savoy
Independent Director8yrsCA$137.85k0.014% CA$191.0k
David Morris
Independent Director2.42yrsCA$119.04k0.0023% CA$31.5k

4.0yrs

Average Tenure

60yo

Average Age

Experienced Board: LB's board of directors are considered experienced (4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Laurentian Bank of Canada's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Laurentian Bank of Canada
  • Ticker: LB
  • Exchange: TSX
  • Founded: 1846
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: CA$1.348b
  • Shares outstanding: 42.75m
  • Website: https://www.lbcfg.ca

Number of Employees


Location

  • Laurentian Bank of Canada
  • 1360 René-Lévesque Boulevard West
  • Suite 600
  • Montréal
  • Quebec
  • H3G 0E5
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LBTSX (The Toronto Stock Exchange)YesCommon SharesCACADJul 1983
LT7DB (Deutsche Boerse AG)YesCommon SharesDEEURJul 1983
LRCD.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJul 1983
LB.PRJTSX (The Toronto Stock Exchange)PFD SHS SER 15CACADMar 2016

Biography

Laurentian Bank of Canada, together with its subsidiaries, provides various banking services to individuals, small and medium-sized enterprises, and institutional customers in Canada and the United States. It operates through Personal, Business Services, and Institutional segments. The company offers notice, demand, and term deposit products; investment accounts; personal loans, such as investment and student loans, home-equity line of credit, credit cards, personal line of credit, and other consumer loans; guaranteed investment certificates; agriculture loan; real estate renting and leasing services; equipment and inventory financing; personal and commercial loans; and residential mortgage loans, as well as mortgage insurance. It sells its products through the bank’s financial clinics, advisors, broker channels, and digital platforms. Laurentian Bank of Canada was founded in 1846 and is headquartered in Montréal, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 00:30
End of Day Share Price2020/03/27 00:00
Earnings2020/01/31
Annual Earnings2019/10/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.