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Cathay General Bancorp

Market Cap

US$3.4b

Last Updated

2021/05/15 22:27 UTC

Data Sources

Company Financials +

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. More Details

Rewards

Trading at 44.6% below our estimate of its fair value

Earnings are forecast to grow 2.85% per year

Pays a reliable dividend of 2.88%

Risk Analysis

No risks detected for CATY from our risk checks.


Snowflake Analysis

Flawless balance sheet average dividend payer.


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 is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

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


Market Performance


7 Day Return

2.0%

CATY

1.0%

US Banks

-1.7%

US Market


1 Year Return

88.9%

CATY

99.1%

US Banks

50.8%

US Market

Return vs Industry: CATY underperformed the US Banks industry which returned 99% over the past year.

Return vs Market: CATY exceeded the US Market which returned 50.5% over the past year.


Shareholder returns

CATYIndustryMarket
7 Day2.0%1.0%-1.7%
30 Day5.1%7.9%-1.2%
90 Day15.0%21.2%0.4%
1 Year96.9%88.9%105.1%99.1%53.3%50.8%
3 Year13.8%2.4%31.9%20.6%61.5%51.4%
5 Year66.3%42.9%115.1%88.0%125.9%100.7%

Long-Term 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?

44.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CATY ($43.04) is trading below our estimate of fair value ($77.63)

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


Price To Earnings Ratio

PE vs Industry: CATY is poor value based on its PE Ratio (13.4x) compared to the US Banks industry average (12.1x).

PE vs Market: CATY is good value based on its PE Ratio (13.4x) compared to the US market (19.9x).


Price to Earnings Growth Ratio

PEG Ratio: CATY is poor value based on its PEG Ratio (4.7x)


Price to Book Ratio

PB vs Industry: CATY is overvalued based on its PB Ratio (1.4x) compared to the US Banks industry average (1.1x).


Future Growth

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

2.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CATY's forecast earnings growth (2.9% per year) is above the savings rate (2%).

Earnings vs Market: CATY's earnings (2.9% per year) are forecast to grow slower than the US market (14.7% per year).

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

Revenue vs Market: CATY's revenue (6% per year) is forecast to grow slower than the US market (9% per year).

High Growth Revenue: CATY's revenue (6% 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 (10.9%).


Past Performance

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

9.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CATY has high quality earnings.

Growing Profit Margin: CATY's current net profit margins (43.9%) are higher than last year (43.8%).


Past Earnings Growth Analysis

Earnings Trend: CATY's earnings have grown by 9.7% per year over the past 5 years.

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

Earnings vs Industry: CATY had negative earnings growth (-1.5%) over the past year, making it difficult to compare to the Banks industry average (18%).


Return on Equity

High ROE: CATY's Return on Equity (10.4%) is considered low.


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


Financial Institutions Analysis

Asset Level: CATY's Assets to Equity ratio (7.8x) is low.

Allowance for Bad Loans: CATY has a sufficient allowance for bad loans (152%).

Low Risk Liabilities: 98% of CATY's liabilities are made up of primarily low risk sources of funding.

Loan Level: CATY has an appropriate level of Loans to Assets ratio (81%).

Low Risk Deposits: CATY's Loans to Deposits ratio (95%) is appropriate.

Level of Bad Loans: CATY has an appropriate level of bad loans (0.6%).


Dividend

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

2.88%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CATY's dividend (2.88%) is higher than the bottom 25% of dividend payers in the US market (1.25%).

High Dividend: CATY's dividend (2.88%) is low compared to the top 25% of dividend payers in the US market (3.42%).


Stability and Growth of Payments

Stable Dividend: CATY's dividends per share have been stable 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 (38.6%), CATY's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

8.8yrs

Average board tenure


CEO

Chang Liu (53 yo)

0.58

Tenure

US$2,110,001

Compensation

Mr. Chang Ming Liu has been President, Chief Executive Officer and Director at Cathay General Bancorp since October 1, 2020. He has been President & Director at Cathay Bank since October 17, 2019 and its C...


CEO Compensation Analysis

Compensation vs Market: Chang's total compensation ($USD2.11M) is below average for companies of similar size in the US market ($USD5.35M).

Compensation vs Earnings: Chang's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Board Members

Experienced Board: CATY's board of directors are considered experienced (8.8 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.


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$3.429b
  • Shares outstanding: 79.67m
  • Website: https://www.cathaygeneralbancorp.com

Number of Employees


Location

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

Listings


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 th...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/05/15 22:27
End of Day Share Price2021/05/14 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


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.