DB:SM1

Stock Analysis Report

Executive Summary

SLM Corporation, through its subsidiaries, operates as a saving, planning, and paying for college company in the United States.

Snowflake

Fundamentals

Undervalued with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

-2.8%

DB:SM1

-0.08%

DE Consumer Finance

0.2%

DE Market


1 Year Return

-28.2%

DB:SM1

-25.1%

DE Consumer Finance

-10.0%

DE Market

SM1 underperformed the Consumer Finance industry which returned -25.7% over the past year.

SM1 underperformed the Market in Germany which returned -10.4% over the past year.


Share holder returns

SM1IndustryMarket
7 Day-2.8%-0.08%0.2%
30 Day-15.1%-5.6%-3.3%
90 Day-18.1%-9.1%-3.9%
1 Year-27.7%-28.2%-22.2%-25.1%-7.1%-10.0%
3 Year13.9%13.2%-32.7%-46.2%11.3%1.7%
5 Year10.4%9.8%-12.8%-38.5%25.8%8.4%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is SLM undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

SLM's share price is below the future cash flow value, and at a moderate discount (> 20%).

SLM's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

SLM is good value based on earnings compared to the Europe Consumer Finance industry average.

SLM is good value based on earnings compared to the Germany market.


Price Based on Expected Growth

SLM is good value based on expected growth next year.


Price Based on Value of Assets

SLM is overvalued based on assets compared to the Europe Consumer Finance industry average.


Next Steps

Future Growth

How is SLM expected to perform in the next 1 to 3 years based on estimates from 9 analysts?

10.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

SLM's revenue is expected to grow by 12.3% yearly, however this is not considered high growth (20% yearly).

SLM's earnings are expected to grow by 10.7% yearly, however this is not considered high growth (20% yearly).

SLM's revenue growth is expected to exceed the Germany market average.

SLM's earnings growth is positive but not above the Germany market average.

SLM's earnings growth is expected to exceed the low risk savings rate of 0.2%.


Earnings per Share Growth Estimates


Future Return on Equity

SLM is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has SLM performed over the past 5 years?

20.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

SLM has delivered over 20% year on year earnings growth in the past 5 years.

SLM's 1-year earnings growth exceeds its 5-year average (56.9% vs 20.1%)

SLM's earnings growth has exceeded the Europe Consumer Finance industry average in the past year (56.9% vs 7.2%).


Return on Equity

SLM has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

SLM used its assets less efficiently than the Europe Consumer Finance industry average last year based on Return on Assets.


Return on Capital Employed

Unable to establish if SLM improved its use of capital last year versus 3 years ago (Return on Capital Employed) due to insufficient past data.


Next Steps

Financial Health

How is SLM's financial position?


Financial Position Analysis

SLM is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

SLM's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

SLM's level of debt (157%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (0.5% vs 157% today).

Operating cash flow is negative therefore debt is not well covered.

Unable to confirm if the interest payments on SLM's debt are well covered by earnings due to lack of past financial data.


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 6x debt.


Next Steps

Dividend

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

1.75%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase SLM before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

SLM's pays a lower dividend yield than the bottom 25% of dividend payers in Germany (1.57%).

SLM's dividend is below the markets top 25% of dividend payers in Germany (4.29%).

It is too early to tell whether SLM has stable dividend payments.

SLM only just started paying a dividend, it is too early to tell if payments are increasing.


Current Payout to Shareholders

Dividends paid are thoroughly covered by earnings (20.9x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be thoroughly covered by earnings (9x coverage).


Next Steps

Management

What is the CEO of SLM's salary, the management and board of directors tenure and is there insider trading?

5.1yrs

Average management tenure


CEO

Ray Quinlan (67yo)

5.3yrs

Tenure

US$6,187,641

Compensation

Mr. Raymond J. Quinlan, also known as Ray, has been the Executive Chairman and Chief Executive Officer of SLM Corporation since April 29, 2014. Mr. Quinlan has 40+ years of tradition with the challenge, mo ...


CEO Compensation Analysis

Ray's remuneration is higher than average for companies of similar size in Germany.

Ray's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

5.1yrs

Average Tenure

59yo

Average Age

The average tenure for the SLM management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

5.3yrs

Average Tenure

69.5yo

Average Age

The tenure for the SLM board of directors is about average.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$459,92004 Mar 19
Jeffrey Dale
EntityIndividual
Role
Senior Key Executive
Chief Risk Officer & Senior VP
Shares46,762
Max PriceUS$9.84
SellUS$669,14304 Mar 19
Jonathan Boyles
EntityIndividual
Shares68,000
Max PriceUS$9.84
SellUS$244,00601 Mar 19
Paul Thome
EntityIndividual
Role
Chief Administrative Officer
Executive VP & Chief Administrative Officer
Shares25,000
Max PriceUS$9.76

Ownership Breakdown


Management Team

  • Steve McGarry (61yo)

    Executive VP & CFO

    • Tenure: 5.3yrs
    • Compensation: US$2.13m
  • Tim Morrison

    Senior Vice President of Government Relations

    • Tenure: 0.0yrs
  • Ray Quinlan (67yo)

    Executive Chairman & CEO

    • Tenure: 5.3yrs
    • Compensation: US$6.19m
  • Martha Holler

    Senior Vice President of Corporate Marketing & Communications

    • Tenure: 0.0yrs
  • Jim Truitt

    Chief Compliance Officer and Senior Vice President

    • Tenure: 11.1yrs
  • Paul Thome (68yo)

    Executive VP & Chief Administrative Officer

    • Tenure: 3.5yrs
    • Compensation: US$1.66m
  • Jeffrey Dale (57yo)

    Chief Risk Officer & Senior VP

    • Tenure: 5.1yrs
    • Compensation: US$1.38m
  • Brian Cronin

    Senior Director of Investor Relations

    • Tenure: 0.0yrs
  • Nic Jafarieh (44yo)

    Senior VP & General Counsel

    • Tenure: 1.4yrs
    • Compensation: US$1.38m
  • Donna Vieira (54yo)

    Executive VP & Chief Marketing Officer

    • Tenure: 0.6yrs

Board Members

  • Bill Shiebler (77yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$195.00k
  • Earl Goode (78yo)

    Director

    • Tenure: 19.1yrs
    • Compensation: US$190.00k
  • Marianne Keler (64yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$190.01k
  • Jed Pitcher (78yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$195.00k
  • Ray Quinlan (67yo)

    Executive Chairman & CEO

    • Tenure: 5.3yrs
    • Compensation: US$6.19m
  • Frank Puleo (74yo)

    Director

    • Tenure: 11.4yrs
    • Compensation: US$195.01k
  • Paul Child (70yo)

    Lead Independent Director

    • Tenure: 5.6yrs
    • Compensation: US$205.01k
  • Mary Carter Franke (62yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$185.01k
  • Robert Strong (69yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$180.01k
  • Jim Matheson (59yo)

    Director

    • Tenure: 4.4yrs
    • Compensation: US$180.01k

Company Information

SLM Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: SLM Corporation
  • Ticker: SM1
  • Exchange: DB
  • Founded: 1972
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: US$3.460b
  • Listing Market Cap: US$3.119b
  • Shares outstanding: 426.59m
  • Website: https://www.salliemae.com

Number of Employees


Location

  • SLM Corporation
  • 300 Continental Drive
  • Newark
  • Delaware
  • 19713
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SLMNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMay 2014
SLMB.PNasdaqGS (Nasdaq Global Select)PFD SER B USUSDMay 2014
SM1DB (Deutsche Boerse AG)YesCommon StockDEEURMay 2014

Biography

SLM Corporation, through its subsidiaries, operates as a saving, planning, and paying for college company in the United States. The company originates and services private education loans to students or th ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/19 21:53
End of Day Share Price2019/08/19 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.