LSE:STB

Stock Analysis Report

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Executive Summary

Secure Trust Bank PLC provides banking and financial products and services in the United Kingdom. More Details


Snowflake Analysis

Undervalued with reasonable growth potential.


Similar Companies

Share Price & News

How has Secure Trust Bank's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: STB has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

17.6%

STB

6.5%

GB Banks

0.07%

GB Market


1 Year Return

-48.0%

STB

-44.5%

GB Banks

-15.4%

GB Market

Return vs Industry: STB underperformed the UK Banks industry which returned -44.5% over the past year.

Return vs Market: STB underperformed the UK Market which returned -15.4% over the past year.


Shareholder returns

STBIndustryMarket
7 Day17.6%6.5%0.07%
30 Day16.9%15.3%1.7%
90 Day18.6%-4.5%-1.8%
1 Year-48.0%-48.0%-44.3%-44.5%-12.1%-15.4%
3 Year-55.6%-59.8%-48.2%-53.3%-8.4%-19.7%
5 Year-66.7%-73.8%-36.4%-47.0%16.4%-9.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Secure Trust Bank undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: STB (£7.41) is trading below our estimate of fair value (£17.34)

Significantly Below Fair Value: STB is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: STB is good value based on its PE Ratio (6.7x) compared to the GB Banks industry average (10.3x).

PE vs Market: STB is good value based on its PE Ratio (6.7x) compared to the UK market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: STB is good value based on its PEG Ratio (0.2x)


Price to Book Ratio

PB vs Industry: STB's PB Ratio (0.5x) is in line with the GB Banks industry average.


Next Steps

Future Growth

How is Secure Trust Bank forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

40.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: STB's forecast earnings growth (40% per year) is above the savings rate (1.2%).

Earnings vs Market: STB's earnings (40% per year) are forecast to grow faster than the UK market (24.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: STB's revenue (8.6% per year) is forecast to grow faster than the UK market (6% per year).

High Growth Revenue: STB's revenue (8.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: STB's Return on Equity is forecast to be low in 3 years time (9.5%).


Next Steps

Past Performance

How has Secure Trust Bank performed over the past 5 years?

13.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: STB has a high level of non-cash earnings.

Growing Profit Margin: STB's current net profit margins (17.1%) are lower than last year (23.9%).


Past Earnings Growth Analysis

Earnings Trend: STB's earnings have grown by 13% per year over the past 5 years.

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

Earnings vs Industry: STB had negative earnings growth (-32.5%) over the past year, making it difficult to compare to the Banks industry average (-20.3%).


Return on Equity

High ROE: STB's Return on Equity (7.9%) is considered low.


Next Steps

Financial Health

How is Secure Trust Bank'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


Financial Institutions Analysis

Asset Level: STB's Assets to Equity ratio (10.1x) is moderate.

Allowance for Bad Loans: STB has a low allowance for bad loans (53%).

Low Risk Liabilities: 84% of STB's liabilities are made up of primarily low risk sources of funding.

Loan Level: STB has an appropriate level of Loans to Assets ratio (90%).

Low Risk Deposits: STB's Loans to Deposits ratio (119%) is appropriate.

Level of Bad Loans: STB has a high level of bad loans (6.1%).


Next Steps

Dividend

What is Secure Trust Bank current dividend yield, its reliability and sustainability?

2.56%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate STB's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate STB's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if STB's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if STB's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: STB is not paying a notable dividend for the UK market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of STB's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

  • Explore strong dividend paying companies in the Banks industry.

Management

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

2.4yrs

Average management tenure


CEO

Paul Lynam (52 yo)

10.08yrs

Tenure

UK£1,804,000

Compensation

Mr. Paul Anthony Lynam, ACIB, AMCT, FIFS, has been the Chief Executive of Secure Trust Bank Plc since September 13, 2010. Mr. Lynam served as the Managing Director of Banking at Royal Bank of Scotland Grou ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD2.35M) is above average for companies of similar size in the UK market ($USD665.09K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Paul Lynam
CEO & Director10.08yrsUK£1.80m0.32%
£ 448.3k
Rachel Lawrence
CFO & Executive Director0.083yrno datano data
David Nield
Chief Operating Officerno datano datano data
Roy Aston
Chief Technology Officerno datano datano data
Alan Karter
General Counselno datano datano data
Paul Kilbride
Chief Compliance Officer & Money Laundering Reporting Officerno datano datano data
Anne McKenning
HR Directorno datano datano data
Ciara Raison
Head of Dealer Sales2.42yrsno datano data
David Mercer
Managing Director - Motor Financeno datano datano data
Kevin Hayes
Chief Risk Officerno datano datano data
John Bevan
Managing Director of Commercial Financeno datano datano data
Jon Bowers
Managing Director of Real Estate & Asset Financeno datano datano data

2.4yrs

Average Tenure

Experienced Management: STB's management team is considered experienced (2.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Paul Lynam
CEO & Director10.08yrsUK£1.80m0.32%
£ 448.3k
Rachel Lawrence
CFO & Executive Director0.083yrno datano data
Dorothy Berresford
Senior Independent Director0.42yrUK£93.00kno data
Michael Forsyth
Independent Non-Executive Chairman4yrsUK£206.00k0.028%
£ 39.3k
Victoria Stewart
Independent Non-Executive Director3.92yrsUK£78.00kno data
David McCreadie
Independent Non Executive Director0.83yrUK£3.00k0.027%
£ 37.1k
Paul Myers
Independent Non-Executive Director1.92yrsUK£71.00k0.019%
£ 25.9k
Jeanne Neville-Rolfe
Independent Non-Executive Director1.92yrsUK£71.00kno data

1.9yrs

Average Tenure

54yo

Average Age

Experienced Board: STB's board of directors are not considered experienced ( 1.9 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: STB 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

Secure Trust Bank PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Secure Trust Bank PLC
  • Ticker: STB
  • Exchange: LSE
  • Founded: 1952
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: UK£137.994m
  • Shares outstanding: 18.62m
  • Website: https://www.securetrustbank.com

Number of Employees


Location

  • Secure Trust Bank PLC
  • One Arleston Way
  • Shirley
  • Solihull
  • West Midlands
  • B90 4LH
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
STBLSE (London Stock Exchange)YesOrdinary SharesGBGBPNov 2011

Biography

Secure Trust Bank PLC provides banking and financial products and services in the United Kingdom. It operates in seven segments: Real Estate Finance, Asset Finance, Commercial Finance, Motor Finance, Retai ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/25 21:39
End of Day Share Price2020/10/23 00:00
Earnings2020/06/30
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.