TSX:TF

Stock Analysis Report

Timbercreek Financial

Executive Summary

Timbercreek Financial Corp., a mortgage investment company, provides shorter-duration structured financing solutions to commercial real estate investors in Canada.

Rewards

Trading at 3% below its fair value

Revenue is forecast to grow 16.96% per year

Earnings have grown 16.4% per year over the past 5 years

Risk Analysis

Earnings are forecast to decline by an average of -1.6% per year for the next 3 years

Dividend of 9.73% is not well covered by earnings or forecast to be in the next 3 years

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Questionable track record unattractive dividend payer.

Share Price & News

How has Timbercreek Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.7%

TF

6.3%

CA Mortgage

3.7%

CA Market


1 Year Return

-24.2%

TF

-21.5%

CA Mortgage

-23.7%

CA Market

Return vs Industry: TF underperformed the Canadian Mortgage industry which returned -21.5% over the past year.

Return vs Market: TF matched the Canadian Market which returned -23.7% over the past year.


Shareholder returns

TFIndustryMarket
7 Day-0.7%6.3%3.7%
30 Day-27.6%-38.7%-19.7%
90 Day-28.7%-44.1%-24.3%
1 Year-18.4%-24.2%-12.4%-21.5%-21.2%-23.7%
3 Year-5.1%-24.0%-9.0%-23.6%-13.3%-21.4%
5 Yearn/a-9.2%-27.2%-0.8%-15.5%

Price Volatility Vs. Market

How volatile is Timbercreek Financial's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Timbercreek Financial undervalued compared to its fair value and its price relative to the market?

3.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TF (CA$7.09) is trading below our estimate of fair value (CA$7.31)

Significantly Below Fair Value: TF is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: TF is poor value based on its PE Ratio (10.7x) compared to the Mortgage industry average (6.7x).

PE vs Market: TF is poor value based on its PE Ratio (10.7x) compared to the Canadian market (10.4x).


Price to Earnings Growth Ratio

PEG Ratio: TF's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: TF is overvalued based on its PB Ratio (0.8x) compared to the CA Mortgage industry average (0.7x).


Next Steps

Future Growth

How is Timbercreek Financial forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

-1.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TF's earnings are forecast to decline over the next 3 years (-1.6% per year).

Earnings vs Market: TF's earnings are forecast to decline over the next 3 years (-1.6% per year).

High Growth Earnings: TF's earnings are forecast to decline over the next 3 years.

Revenue vs Market: TF's revenue (17% per year) is forecast to grow faster than the Canadian market (3.7% per year).

High Growth Revenue: TF's revenue (17% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TF's Return on Equity is forecast to be low in 3 years time (7.6%).


Next Steps

Past Performance

How has Timbercreek Financial performed over the past 5 years?

16.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TF has high quality earnings.

Growing Profit Margin: TF's current net profit margins (77.9%) are lower than last year (78.7%).


Past Earnings Growth Analysis

Earnings Trend: TF's earnings have grown by 16.4% per year over the past 5 years.

Accelerating Growth: TF's earnings growth over the past year (3.2%) is below its 5-year average (16.4% per year).

Earnings vs Industry: TF earnings growth over the past year (3.2%) underperformed the Mortgage industry 12.7%.


Return on Equity

High ROE: TF's Return on Equity (7.5%) is considered low.


Next Steps

Financial Health

How is Timbercreek Financial'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: TF has a low level of unsold assets or inventory.

Debt Coverage by Assets: TF's debt is covered by short term assets (assets are 1.6x debt).


Financial Institutions Analysis

Asset Level: TF's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if TF has a sufficient allowance for bad loans.

Low Risk Liabilities: TF reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if TF has an acceptable proportion of non-loan assets held.

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

Level of Bad Loans: Insufficient data to determine if TF has an appropriate level of bad loans.


Next Steps

Dividend

What is Timbercreek Financial's current dividend yield, its reliability and sustainability?

9.73%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TF's dividend (9.73%) is higher than the bottom 25% of dividend payers in the Canadian market (2.69%).

High Dividend: TF's dividend (9.73%) is in the top 25% of dividend payers in the Canadian market (8.66%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, TF has been paying a dividend for less than 10 years.

Growing Dividend: TF's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (104.2%), TF's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TF's dividends in 3 years are not forecast to be well covered by earnings (99.4% payout ratio).


Next Steps

Management

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

2.3yrs

Average management tenure


CEO

Cam Goodnough

2.25s

Tenure

CA$328,125

Compensation

Mr. Cameron Goodnough, also known as Cam, is the Chief Executive Officer of Timbercreek Financial Corporation since January 1, 2018 and has been its Director since November 7, 2018. Mr. Goodnough has been  ...


CEO Compensation Analysis

Compensation vs Market: Cam's total compensation ($USD231.49K) is below average for companies of similar size in the Canadian market ($USD1.22M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Cameron Goodnough
CEO, President & Non-Independent Director2.25yrsCA$328.13k0.0043% CA$25.2k
Gigi Wong
Chief Financial Officer2.42yrsCA$120.00k0.0025% CA$14.8k
Scott Rowland
Managing Director of Global Debt Investments1.25yrsno data0.0036% CA$21.3k
Peter Hawkings
VP & Corporate Secretaryno datano datano data
Geoff McTait
Executive Director & Head of Origination - Canada1.25yrsno datano data
Andrew Jones
Consultant2.25yrsCA$453.00kno data

2.3yrs

Average Tenure

Experienced Management: TF's management team is considered experienced (2.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Cameron Goodnough
CEO, President & Non-Independent Director2.25yrsCA$328.13k0.0043% CA$25.2k
Derek Watchorn
Independent Director3.83yrsCA$64.20k0.055% CA$325.7k
Zelick Altman
Independent Director3.83yrsCA$46.58k0.042% CA$249.0k
Ugo Bizzarri
Non-Independent Director3.83yrsCA$149.76k0.055% CA$325.0k
W. Shyba
Lead Independent Directorno dataCA$67.66k0.015% CA$89.8k
Robert Tamblyn
Non-Independent Chairman3.83yrsCA$120.00k0.075% CA$445.1k
Pamela Spackman
Independent Director1.25yrsno data0.0068% CA$40.4k
Steven Scott
Independent Director3.83yrsCA$61.72k0.052% CA$310.2k

3.8yrs

Average Tenure

67yo

Average Age

Experienced Board: TF's board of directors are considered experienced (3.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: TF insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.2%.


Top Shareholders

Company Information

Timbercreek Financial Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Timbercreek Financial Corp.
  • Ticker: TF
  • Exchange: TSX
  • Founded: 2016
  • Industry: Thrifts and Mortgage Finance
  • Sector: Banks
  • Market Cap: CA$591.107m
  • Shares outstanding: 83.37m
  • Website: https://www.timbercreekfinancial.com

Location

  • Timbercreek Financial Corp.
  • 25 Price Street
  • Toronto
  • Ontario
  • M4W 1Z1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TFTSX (The Toronto Stock Exchange)YesCommon SharesCACADJul 2016

Biography

Timbercreek Financial Corp., a mortgage investment company, provides shorter-duration structured financing solutions to commercial real estate investors in Canada. It focuses on lending against income-producing commercial real estate properties, such as multi-residential, office, and retail buildings located in urban markets. The company was founded in 2016 and is headquartered in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 14:54
End of Day Share Price2020/03/31 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.