Meezan Bank (KASE:MEBL) - Share price, News & Analysis

MEBL fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	2/6
Past Performance	4/6
Financial Health	5/6
Dividends	4/6

MEBL Stock Overview

Meezan Bank Limited, an Islamic bank, provides corporate, commercial, consumer, investment, and retail banking services in Pakistan.

Rewards

Trading at 7.3% below our estimate of its fair value

Revenue is forecast to grow 11.95% per year

Earnings grew by 33.9% over the past year

Risk Analysis

Unstable dividend track record

Meezan Bank Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Meezan Bank
Historical stock prices
Current Share Price	PK₨129.85
52 Week High	PK₨158.90
52 Week Low	PK₨93.66
Beta	0.59
1 Month Change	-10.90%
3 Month Change	-6.94%
1 Year Change	37.63%
3 Year Change	91.22%
5 Year Change	143.13%
Change since IPO	6,307.15%

Shareholder Returns

	MEBL	PK Banks	PK Market
7D	-0.2%	-1.2%	-1.8%
1Y	37.6%	-0.4%	-12.4%

Return vs Industry: MEBL exceeded the PK Banks industry which returned -0.4% over the past year.

Return vs Market: MEBL exceeded the PK Market which returned -12.4% over the past year.

Price Volatility

Is MEBL's price volatile compared to industry and market?
MEBL volatility
MEBL Average Weekly Movement	4.8%
Banks Industry Average Movement	4.8%
Market Average Movement	5.7%
10% most volatile stocks in PK Market	8.9%
10% least volatile stocks in PK Market	3.5%

Stable Share Price: MEBL is not significantly more volatile than the rest of PK stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: MEBL's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1997	11,710	Irfan Siddiqui	https://www.meezanbank.com

Meezan Bank Limited, an Islamic bank, provides corporate, commercial, consumer, investment, and retail banking services in Pakistan. The company operates through Corporate and Commercial Banking, Retail Banking, Trading and Sales, and Others segments. It offers trade finance, export finance, project finance, Ijarah, guarantees, and bills of exchange relating to its corporate and commercial customers.

Meezan Bank Fundamentals Summary

How do Meezan Bank's earnings and revenue compare to its market cap?
MEBL fundamental statistics
Market Cap	PK₨211.26b
Earnings (TTM)	PK₨31.36b
Revenue (TTM)	PK₨90.27b

6.7x

P/E Ratio

2.3x

P/B Ratio

Is MEBL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
MEBL income statement (TTM)
Revenue	PK₨90.27b
Cost of Revenue	PK₨1.22b
Gross Profit	PK₨89.05b
Other Expenses	PK₨57.69b
Earnings	PK₨31.36b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	19.28
Gross Margin	98.64%
Net Profit Margin	34.74%
Debt/Equity Ratio	469.3%

How did MEBL perform over the long term?

See historical performance and comparison

Dividends

4.3%

Current Dividend Yield

31%

Payout Ratio

Valuation

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

Valuation Score

1/6

Valuation Score 1/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

7.3%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: MEBL (PKR129.85) is trading below our estimate of fair value (PKR140.12)

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

Price To Earnings Ratio

PE vs Industry: MEBL is poor value based on its PE Ratio (6.7x) compared to the PK Banks industry average (4.9x).

PE vs Market: MEBL is poor value based on its PE Ratio (6.7x) compared to the PK market (5.6x).

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate MEBL's PEG Ratio to determine if it is good value.

Price to Book Ratio

PB vs Industry: MEBL is overvalued based on its PB Ratio (2.3x) compared to the PK Banks industry average (0.7x).

Future Growth

How is Meezan Bank forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

12.0%

Forecasted annual revenue growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if MEBL's forecast earnings growth is above the savings rate (10.2%).

Earnings vs Market: Insufficient data to determine if MEBL's earnings are forecast to grow faster than the PK market

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

Revenue vs Market: MEBL's revenue (12% per year) is forecast to grow faster than the PK market (3.3% per year).

High Growth Revenue: MEBL's revenue (12% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: MEBL's Return on Equity is forecast to be high in 3 years time (29.4%)

Past Performance

How has Meezan Bank performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

34.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MEBL has high quality earnings.

Growing Profit Margin: MEBL's current net profit margins (34.7%) are higher than last year (33.8%).

Past Earnings Growth Analysis

Earnings Trend: MEBL's earnings have grown significantly by 34.7% per year over the past 5 years.

Accelerating Growth: MEBL's earnings growth over the past year (33.9%) is below its 5-year average (34.7% per year).

Earnings vs Industry: MEBL earnings growth over the past year (33.9%) exceeded the Banks industry 11.6%.

Return on Equity

High ROE: Whilst MEBL's Return on Equity (33.69%) is high, this metric is skewed due to their high level of debt.

Financial Health

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

Financial Health Score

5/6

Financial Health Score 5/6

Asset Level
Allowance for Bad Loans
Low Risk Liabilities
Loan Level
Low Risk Deposits
Level of Bad Loans

Financial Position Analysis

Debt to Equity History and Analysis

Balance Sheet

Financial Institutions Analysis

Asset Level: MEBL's Assets to Equity ratio (22.6x) is very high.

Allowance for Bad Loans: MEBL has a sufficient allowance for bad loans (133%).

Low Risk Liabilities: 72% of MEBL's liabilities are made up of primarily low risk sources of funding.

Loan Level: MEBL has an appropriate level of Loans to Assets ratio (44%).

Low Risk Deposits: MEBL's Loans to Deposits ratio (64%) is appropriate.

Level of Bad Loans: MEBL has an appropriate level of bad loans (1.4%).

Dividend

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

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

4.31%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: MEBL's dividend (4.31%) is higher than the bottom 25% of dividend payers in the PK market (3.72%).

High Dividend: MEBL's dividend (4.31%) is low compared to the top 25% of dividend payers in the PK market (11.25%).

Stability and Growth of Payments

Stable Dividend: MEBL's dividend payments have been volatile in the past 10 years.

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

Current Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (31.4%), MEBL's dividend payments are well covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: MEBL's dividends in 3 years are forecast to be well covered by earnings (37.5% payout ratio).

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?

3.3yrs

Average board tenure

CEO

Irfan Siddiqui

25.33yrs

Tenure

PK₨10,637,000

Compensation

Mr. Irfan Siddiqui serves as the Chief Executive Officer and President of Meezan Bank Limited. Mr. Siddiqui served as the Chairman of the Board at Al Meezan Investment Management Limited until 2007, which...

Board Members

Experienced Board: MEBL's board of directors are considered experienced (3.3 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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/05/18 00:00
End of Day Share Price	2022/05/18 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31