NasdaqGS:BANR

Stock Analysis Report

Executive Summary

Banner Corporation operates as the bank holding company for Banner Bank and Islanders Bank that provides commercial banking and financial products and services to individuals, businesses, and public sector entities primarily in the United States.

Rewards

PE ratio (12.6x) is below the US market (18.9x)

Earnings grew by 75.7% over the past year

Risk Analysis

Unstable dividend track record

Shareholders have been diluted in the past year



Snowflake Analysis

Flawless balance sheet with solid track record and pays a dividend.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

1.1%

BANR

-0.08%

US Banks

2.0%

US Market


1 Year Return

-2.5%

BANR

15.5%

US Banks

23.6%

US Market

Return vs Industry: BANR underperformed the US Banks industry which returned 21.7% over the past year.

Return vs Market: BANR underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

BANRIndustryMarket
7 Day1.1%-0.08%2.0%
30 Day-6.9%-1.6%3.9%
90 Day-0.4%9.2%12.0%
1 Year2.3%-2.5%18.9%15.5%26.2%23.6%
3 Year8.5%-3.4%34.6%25.1%53.2%43.3%
5 Year55.9%34.0%86.1%65.2%75.7%56.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

12.65x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: BANR ($54.46) is trading above our estimate of fair value ($48.94)

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


Price To Earnings Ratio

PE vs Industry: BANR is good value based on its PE Ratio (12.6x) compared to the Banks industry average (12.8x).

PE vs Market: BANR is good value based on its PE Ratio (12.6x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: BANR is poor value based on its PEG Ratio (11.4x)


Price to Book Ratio

PB vs Industry: BANR is overvalued based on its PB Ratio (1.2x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Banner forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

1.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BANR's forecast earnings growth (1.1% per year) is below the savings rate (1.7%).

Earnings vs Market: BANR's earnings (1.1% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: BANR's revenue (3% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: BANR's revenue (3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: BANR's Return on Equity is forecast to be low in 3 years time (8.7%).


Next Steps

Past Performance

How has Banner performed over the past 5 years?

22.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BANR has high quality earnings.

Growing Profit Margin: BANR's current net profit margins (27.8%) are higher than last year (17.7%).


Past Earnings Growth Analysis

Earnings Trend: BANR's earnings have grown significantly by 22.6% per year over the past 5 years.

Accelerating Growth: BANR's earnings growth over the past year (75.7%) exceeds its 5-year average (22.6% per year).

Earnings vs Industry: BANR earnings growth over the past year (75.7%) exceeded the Banks industry 27.1%.


Return on Equity

High ROE: BANR's Return on Equity (9.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Banner'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: BANR has a low level of unsold assets or inventory.

Debt Coverage by Assets: BANR's debt is covered by short term assets (assets are 1x debt).


Financial Institutions Analysis

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

Allowance for Bad Loans: BANR has a sufficient allowance for bad loans.

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

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

Low Risk Deposits: BANR's loans are broadly funded by customer deposits.

Level of Bad Loans: BANR has an appropriate level of bad loans (0.21%)


Next Steps

Dividend

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

2.99%

Current Dividend Yield


Dividend Yield vs Market

company3.0%marketbottom25%1.4%markettop25%3.7%industryaverage2.8%forecastin3Years3.2%

Current dividend yield vs market & industry

Notable Dividend: BANR's dividend (3.01%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: BANR's dividend (3.01%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (37.1%), BANR's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: BANR's dividends in 3 years are forecast to be well covered by earnings (41.3% payout ratio).


Next Steps

Management

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

3.9yrs

Average management tenure


CEO

Mark Grescovich (55yo)

9.4yrs

Tenure

US$2,513,936

Compensation

Mr. Mark J. Grescovich has been the President of Banner Bank and Banner Corporation since April 6, 2010. Mr. Grescovich has been the Chief Executive Officer of Banner Bank and Banner Corporation since Augu ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD2.51M) is below average for companies of similar size in the US market ($USD3.86M).

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


Management Age and Tenure

3.9yrs

Average Tenure

57yo

Average Age

Experienced Management: BANR's management team is considered experienced (3.9 years average tenure).


Board Age and Tenure

3.8yrs

Average Tenure

61yo

Average Age

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


Insider Trading

Insider Buying: BANR insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$27,95512 Dec 19
John Layman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$55.91
SellUS$22,19320 Nov 19
Brent Orrico
EntityIndividual
Role
Chairman of the Board
Chairman of the Board
Shares403
Max PriceUS$55.07
SellUS$20,23920 Nov 19
Brent Orrico
EntityIndividual
Role
Chairman of the Board
Chairman of the Board
Shares361
Max PriceUS$56.06
SellUS$28,00010 Sep 19
John Layman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$56.00
SellUS$110,49309 Sep 19
Cynthia Purcell
EntityIndividual
Role
Other Key Executive
Executive VP
Shares2,039
Max PriceUS$54.19
SellUS$27,58523 Aug 19
John Layman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$55.18
BuyUS$6,38002 Aug 19
Kevin Riordan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares111
Max PriceUS$57.48
SellUS$26,21402 May 19
Steven Rust
EntityIndividual
Shares491
Max PriceUS$53.40
SellUS$759,82525 Feb 19
Cheryl Bishop
EntityIndividual
Shares11,943
Max PriceUS$63.65

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6.9%.


Management Team

  • Cindy Purcell (62yo)

    Executive VP

    • Compensation: US$1.44m
  • Mark Grescovich (55yo)

    President

    • Tenure: 9.4yrs
    • Compensation: US$2.51m
  • Albert Marshall

    Senior VP & Secretary

    • Gary Wagers (58yo)

      Executive Vice President of Retail Products & Services of Banner Bank

      • Tenure: 18yrs
    • Jim Reed (56yo)

      Executive Vice President of West Region for Commercial Banking of Banner Bank

      • Tenure: 4.3yrs
    • Keith Western (63yo)

      Executive Vice President of Commercial Banking of South of Banner Bank

      • Compensation: US$736.80k
    • Peter Conner (53yo)

      Executive VP

      • Tenure: 1.7yrs
      • Compensation: US$838.99k
    • Kayleen Kohler (46yo)

      Executive Vice President of Human Resources of Banner Bank

      • Tenure: 3.6yrs
    • Craig Miller (67yo)

      Executive VP

      • Tenure: 3.4yrs
    • Rich Arnold

      Head of Investor Relations


      Board Members

      • Dave Matson (74yo)

        Independent Director

        • Tenure: 3.8yrs
        • Compensation: US$119.75k
      • Roberto Herencia (59yo)

        Independent Director

        • Tenure: 3.8yrs
        • Compensation: US$126.85k
      • Brent Orrico (69yo)

        Chairman of the Board

        • Tenure: 1yrs
        • Compensation: US$160.16k
      • Mark Grescovich (55yo)

        President

        • Tenure: 9.4yrs
        • Compensation: US$2.51m
      • Terry Schwakopf (68yo)

        Independent Director

        • Tenure: 1.8yrs
        • Compensation: US$87.06k
      • John Layman (60yo)

        Independent Director

        • Tenure: 12.7yrs
        • Compensation: US$123.25k
      • David Klaue (65yo)

        Independent Director

        • Tenure: 12.7yrs
        • Compensation: US$108.86k
      • Connie Collingsworth (60yo)

        Independent Director

        • Tenure: 6.8yrs
        • Compensation: US$120.18k
      • Merline Saintil (42yo)

        Independent Director

        • Tenure: 2.9yrs
        • Compensation: US$107.39k
      • Kevin Riordan (62yo)

        Independent Director

        • Tenure: 1.8yrs
        • Compensation: US$87.06k

      Company Information

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


      Key Information

      • Name: Banner Corporation
      • Ticker: BANR
      • Exchange: NasdaqGS
      • Founded: 1890
      • Industry: Regional Banks
      • Sector: Banks
      • Market Cap: US$1.875b
      • Shares outstanding: 34.17m
      • Website: https://www.bannerbank.com

      Number of Employees


      Location

      • Banner Corporation
      • 10 South First Avenue
      • Walla Walla
      • Washington
      • 99362
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      BANRNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDNov 1995

      Biography

      Banner Corporation operates as the bank holding company for Banner Bank and Islanders Bank that provides commercial banking and financial products and services to individuals, businesses, and public sector entities primarily in the United States. It offers deposit products, including interest-bearing and non-interest-bearing checking accounts, money market deposit accounts, regular savings accounts, and certificates of deposit, as well as treasury management services and retirement savings plans. The company also provides commercial real estate loans, including owner-occupied, investment properties, and multifamily residential real estate loans; construction, land, and land development loans; residential mortgage loans; commercial business loans; agricultural loans; and consumer loans, such as home equity lines of credit, automobile, and boat and recreational vehicle loans, as well as loans secured by deposit accounts. In addition, it engages in the mortgage banking operations through the origination and sale of one- to four-family and multi-family residential loans. Further, the company provides electronic and digital banking services. As of December 31, 2018, it operated 182 branch offices, including 179 Banner Bank branches and 3 Islanders Bank branches located in Washington, Oregon, California, and Idaho. It also operates 17 Banner Bank loan production offices located in Washington, Oregon, California, Idaho, and Utah. Banner Corporation was founded in 1890 and is based in Walla Walla, Washington. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/18 23:32
      End of Day Share Price2020/01/17 00:00
      Earnings2019/09/30
      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.