NasdaqGS:CATY

Stock Analysis Report

Cathay General Bancorp

Executive Summary

Cathay General Bancorp operates as the holding company for Cathay Bank that offers various commercial banking products and services to individuals, professionals, and small to medium-sized businesses in the United States.


Snowflake Analysis

Flawless balance sheet, good value and pays a dividend.


Similar Companies

Share Price & News

How has Cathay General Bancorp's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.3%

CATY

-0.3%

US Banks

0.06%

US Market


1 Year Return

-8.3%

CATY

11.1%

US Banks

19.3%

US Market

Return vs Industry: CATY underperformed the US Banks industry which returned 11.1% over the past year.

Return vs Market: CATY underperformed the US Market which returned 19.3% over the past year.


Shareholder returns

CATYIndustryMarket
7 Day-1.3%-0.3%0.06%
30 Day-1.8%-0.5%1.7%
90 Day-2.4%0.6%9.0%
1 Year-5.1%-8.3%14.4%11.1%21.8%19.3%
3 Year-0.9%-8.7%24.7%15.7%49.5%39.9%
5 Year58.4%40.3%74.9%55.1%73.1%54.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Cathay General Bancorp undervalued compared to its fair value and its price relative to the market?

46.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CATY ($36.73) is trading below our estimate of fair value ($68.09)

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


Price To Earnings Ratio

PE vs Industry: CATY is good value based on its PE Ratio (10.5x) compared to the Banks industry average (12.6x).

PE vs Market: CATY is good value based on its PE Ratio (10.5x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: CATY is overvalued based on its PB Ratio (1.3x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Cathay General Bancorp forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

-0.005%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CATY's earnings are forecast to decline over the next 3 years (-0% per year).

Earnings vs Market: CATY's earnings are forecast to decline over the next 3 years (-0% per year).

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

Revenue vs Market: CATY's revenue (2.4% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: CATY's revenue (2.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CATY's Return on Equity is forecast to be low in 3 years time (11.8%).


Next Steps

Past Performance

How has Cathay General Bancorp performed over the past 5 years?

14.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CATY has high quality earnings.

Growing Profit Margin: CATY's current net profit margins (44.5%) are lower than last year (45%).


Past Earnings Growth Analysis

Earnings Trend: CATY's earnings have grown by 14.8% per year over the past 5 years.

Accelerating Growth: CATY's earnings growth over the past year (2.7%) is below its 5-year average (14.8% per year).

Earnings vs Industry: CATY earnings growth over the past year (2.7%) underperformed the Banks industry 12.2%.


Return on Equity

High ROE: CATY's Return on Equity (12.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Cathay General Bancorp'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: CATY has a low level of unsold assets or inventory.

Debt Coverage by Assets: CATY's debt is not covered by short term assets (assets are 0.3x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: CATY has an appropriate level of bad loans (0.31%)


Next Steps

Dividend

What is Cathay General Bancorp's current dividend yield, its reliability and sustainability?

3.42%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CATY's dividend (3.38%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: CATY's dividend (3.38%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (35.5%), CATY's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CATY's dividends in 3 years are forecast to be well covered by earnings (38.2% payout ratio).


Next Steps

Management

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

5.4yrs

Average management tenure


CEO

Pin Tai (65yo)

3.3yrs

Tenure

US$2,274,424

Compensation

Mr. Pin Tai has been the Chief Executive Officer of Cathay General Bancorp since October 2016 and served as its President since October 2016 until 2019. He serves as Chief Executive Officer of Cathay Bank  ...


CEO Compensation Analysis

Compensation vs Market: Pin's total compensation ($USD2.27M) is below average for companies of similar size in the US market ($USD4.88M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Dunson Cheng
Executive Chairman of the Board26.1yrsUS$2.20m0.96% $28.1m
Pin Tai
CEO & Director3.3yrsUS$2.27m0.066% $1.9m
Heng Chen
Executive VP16.7yrsUS$1.17m0.14% $4.1m
Irwin Wong
Senior Executive VP & Chief Administrative Officer of Cathay Bank21.1yrsUS$1.17m0.077% $2.2m
Kim Bingham
Executive VP & Chief Risk Officer of Cathay Bank15.5yrsUS$813.89k0.032% $928.0k
Georgia Lo
Assistant Secretary & Investor Relations0yrsno datano data
Lisa Kim
Executive VP5.4yrsno data0.00054% $15.8k
Chang Liu
President1.1yrsno data0.0031% $91.1k
Mark Lee
Executive VP & Chief Credit Officer of Cathay Bank2.2yrsno data0.00034% $10.0k

5.4yrs

Average Tenure

63.5yo

Average Age

Experienced Management: CATY's management team is seasoned and experienced (5.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Dunson Cheng
Executive Chairman of the Board26.1yrsUS$2.20m0.96% $28.1m
Pin Tai
CEO & Director3.3yrsUS$2.27m0.066% $1.9m
Peter Wu
Vice Chairman of the Board16.3yrsUS$388.38k1% $29.4m
Anthony Tang
Vice Chairman of the Board6.3yrsUS$369.72k1.2% $35.1m
Ting Liu
Independent Director16.3yrsUS$171.98k0.47% $13.9m
Joseph C. Poon
Independent Director30.1yrsUS$167.73k0.078% $2.3m
Kelly Chan
Independent Director30.1yrsUS$174.73k0.31% $9.1m
Michael M. Chang
Independent Director30.1yrsUS$181.48k0.30% $8.9m
Nelson Chung
Lead Director2.8yrsUS$155.73k0.042% $1.2m
Jane Jelenko
Independent Director8.1yrsUS$178.73k0.0075% $218.8k

16.3yrs

Average Tenure

71yo

Average Age

Experienced Board: CATY's board of directors are seasoned and experienced ( 16.3 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: CATY insiders have only sold shares 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

Cathay General Bancorp's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Cathay General Bancorp
  • Ticker: CATY
  • Exchange: NasdaqGS
  • Founded: 1962
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$2.928b
  • Shares outstanding: 79.73m
  • Website: https://www.cathaygeneralbancorp.com

Number of Employees


Location

  • Cathay General Bancorp
  • 777 North Broadway
  • Los Angeles
  • California
  • 90012
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CATYNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDDec 1990
CN7DB (Deutsche Boerse AG)YesCommon StockDEEURDec 1990

Biography

Cathay General Bancorp operates as the holding company for Cathay Bank that offers various commercial banking products and services to individuals, professionals, and small to medium-sized businesses in the United States. The company offers various deposit products, including passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, and public funds deposits. It also provides loan products, such as commercial mortgage loans, commercial loans, small business administration loans, residential mortgage loans, real estate construction loans, and home equity lines of credit, as well as installment loans to individuals for automobile, household, and other consumer expenditures. In addition, the company offers letter of credit, wire transfer, forward currency spot and forward contract, traveler’s check, safe deposit, night deposit, social security payment deposit, collection, bank-by-mail, drive-up and walk-up window, automatic teller machine, Internet banking, trade financing, and other customary bank services, as well as securities and insurance products. As of December 31, 2018, it operated 26 branches in Southern California; 14 branches in Northern California; 11 branches in New York; 3 branches in Illinois area; 4 branches in Washington; 2 branches in Texas; and 1 each branch in Maryland, Massachusetts, Nevada, New Jersey, and Hong Kong, as well as 1 representative office in Taipei and Shanghai. The company was founded in 1962 and is headquartered in Los Angeles, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/22 00:26
End of Day Share Price2020/02/21 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.