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Meridian Bancorp

Nasdaq:EBSB
Snowflake Description

Flawless balance sheet with proven track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
EBSB
Nasdaq
$840M
Market Cap
  1. Home
  2. US
  3. Banks
Company description

Meridian Bancorp, Inc. operates as the holding company for East Boston Savings Bank that provides various financial products and services for individuals and businesses primarily in Essex, Middlesex, Norfolk, and Suffolk Counties, Massachusetts. The last earnings update was 202 days ago. More info.


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EBSB Share Price and Events
Price Volatility
EBSB
Industry
5yr Volatility vs Market

Value

 Is Meridian Bancorp undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Meridian Bancorp to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Meridian Bancorp.

NasdaqGS:EBSB Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model Excess Returns Model
Stable EPS Median Return on Equity from the past 5 years.
= Stable Book Value * Return on Equity
= $13.74 * 5.6%
$0.77
Book Value of Equity per Share Weighted future Book Value estimates from 2 analysts. $13.74
Discount Rate (Cost of Equity) See below 9.2%
Perpetual Growth Rate 10-Year US Government Bond Rate 3%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NasdaqGS:EBSB
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 3%
Equity Risk Premium S&P Global 7.1%
Mortgage Unlevered Beta Simply Wall St/ S&P Global 0.86
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.861 (1 + (1- 21%) (70.8%))
0.888
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.89
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.95% + (0.888 * 7.05%)
9.21%

Discounted Cash Flow Calculation for NasdaqGS:EBSB using Excess Returns Model Model

The calculations below outline how an intrinsic value for Meridian Bancorp is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.

In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.

The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.

Note the calculations below are per share.

See our documentation to learn about this calculation.

NasdaqGS:EBSB Value of Excess Returns
Calculation Result
Excess Returns = (Stable Return on equity – Cost of equity) (Book Value of Equity per share)
= (5.6% – 9.21%) * $13.74)
$-0.49
Terminal Value of Excess Returns = Excess Returns / (Cost of Equity - Expected Growth Rate)
= $-0.49 / (9.21% - 2.95%)
$-7.86
Value of Equity = Book Value per share + Terminal Value of Excess Returns
= $13.74 + $-7.86
$5.88
NasdaqGS:EBSB Discount to Share Price
Calculation Result
Value per share (USD) From above. $5.88
Current discount Discount to share price of $17.25
= -1 x ($17.25 - $5.88) / $5.88
-193.4%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Meridian Bancorp is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Meridian Bancorp's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Meridian Bancorp's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NasdaqGS:EBSB PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-06-30) in USD $0.94
NasdaqGS:EBSB Share Price ** NasdaqGS (2018-09-19) in USD $17.25
United States of America Mortgage Industry PE Ratio Median Figure of 142 Publicly-Listed Mortgage Companies 20.14x
United States of America Market PE Ratio Median Figure of 3,050 Publicly-Listed Companies 20.12x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Meridian Bancorp.

NasdaqGS:EBSB PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NasdaqGS:EBSB Share Price ÷ EPS (both in USD)

= 17.25 ÷ 0.94

18.32x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Meridian Bancorp is good value based on earnings compared to the US Mortgage industry average.
  • Meridian Bancorp is good value based on earnings compared to the United States of America market.
Price based on expected Growth
Does Meridian Bancorp's expected growth come at a high price?
Raw Data
NasdaqGS:EBSB PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 18.32x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 4 Analysts
14.5%per year
United States of America Mortgage Industry PEG Ratio Median Figure of 52 Publicly-Listed Mortgage Companies 1.25x
United States of America Market PEG Ratio Median Figure of 2,048 Publicly-Listed Companies 1.38x

*Line of best fit is calculated by linear regression .

NasdaqGS:EBSB PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 18.32x ÷ 14.5%

1.26x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Meridian Bancorp is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Meridian Bancorp's assets?
Raw Data
NasdaqGS:EBSB PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-06-30) in USD $12.92
NasdaqGS:EBSB Share Price * NasdaqGS (2018-09-19) in USD $17.25
United States of America Mortgage Industry PB Ratio Median Figure of 154 Publicly-Listed Mortgage Companies 1.23x
United States of America Market PB Ratio Median Figure of 5,247 Publicly-Listed Companies 2.01x
NasdaqGS:EBSB PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NasdaqGS:EBSB Share Price ÷ Book Value per Share (both in USD)

= 17.25 ÷ 12.92

1.33x

* Primary Listing of Meridian Bancorp.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Meridian Bancorp is overvalued based on assets compared to the US Mortgage industry average.
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Value checks
We assess Meridian Bancorp's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Mortgage industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Mortgage industry average (and greater than 0)? (1 check)
  5. Meridian Bancorp has a total score of 2/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Meridian Bancorp expected to perform in the next 1 to 3 years based on estimates from 4 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
14.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Meridian Bancorp expected to grow at an attractive rate?
  • Meridian Bancorp's earnings growth is expected to exceed the low risk savings rate of 3%.
Growth vs Market Checks
  • Meridian Bancorp's earnings growth is positive but not above the United States of America market average.
  • Meridian Bancorp's revenue growth is expected to exceed the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NasdaqGS:EBSB Future Growth Rates Data Sources
Data Point Source Value (per year)
NasdaqGS:EBSB Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 4 Analysts 14.5%
NasdaqGS:EBSB Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 4 Analysts 10.5%
United States of America Mortgage Industry Earnings Growth Rate Market Cap Weighted Average 11.7%
United States of America Mortgage Industry Revenue Growth Rate Market Cap Weighted Average 8.1%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 16.7%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.7%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NasdaqGS:EBSB Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 4 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NasdaqGS:EBSB Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2020-12-31 220 72 3
2019-12-31 199 66 3
2018-12-31 179 56 3
NasdaqGS:EBSB Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2018-06-30 170 62 48
2018-03-31 167 59 46
2017-12-31 163 50 43
2017-09-30 152 44 45
2017-06-30 146 48 41
2017-03-31 135 47 36
2016-12-31 130 44 34
2016-09-30 121 37 30
2016-06-30 114 34 26
2016-03-31 112 36 26
2015-12-31 109 28 25
2015-09-30 106 28 24

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Meridian Bancorp's earnings are expected to grow by 14.5% yearly, however this is not considered high growth (20% yearly).
  • Meridian Bancorp's revenue is expected to grow by 10.5% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NasdaqGS:EBSB Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 4 Analyst Estimates (S&P Global) See Below

All data from Meridian Bancorp Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:EBSB Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2020-12-31 1.37 1.40 1.35 3.00
2019-12-31 1.23 1.25 1.20 4.00
2018-12-31 1.06 1.06 1.05 4.00
NasdaqGS:EBSB Past Financials Data
Date (Data in USD Millions) EPS *
2018-06-30 0.94
2018-03-31 0.89
2017-12-31 0.84
2017-09-30 0.89
2017-06-30 0.81
2017-03-31 0.71
2016-12-31 0.67
2016-09-30 0.58
2016-06-30 0.50
2016-03-31 0.49
2015-12-31 0.47
2015-09-30 0.46

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Meridian Bancorp is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Meridian Bancorp's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Meridian Bancorp has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Meridian Bancorp performed over the past 5 years?

  • Meridian Bancorp's last earnings update was 202 days ago.
The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Meridian Bancorp's growth in the last year to its industry (Mortgage).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Meridian Bancorp has delivered over 20% year on year earnings growth in the past 5 years.
  • Meridian Bancorp's 1-year earnings growth is less than its 5-year average (16.9% vs 25.1%)
  • Meridian Bancorp's earnings growth has exceeded the US Mortgage industry average in the past year (16.9% vs 9.5%).
Earnings and Revenue History
Meridian Bancorp's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Meridian Bancorp Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:EBSB Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-06-30 169.97 48.41 87.63
2018-03-31 166.93 45.70 85.55
2017-12-31 162.74 42.95 82.92
2017-09-30 151.72 45.23 80.96
2017-06-30 146.27 41.40 79.67
2017-03-31 135.37 35.96 77.87
2016-12-31 129.57 34.19 75.46
2016-09-30 121.31 29.76 74.95
2016-06-30 114.16 26.00 73.82
2016-03-31 111.59 25.68 71.89
2015-12-31 109.26 24.61 70.70
2015-09-30 105.92 23.77 68.13
2015-06-30 105.07 24.04 66.90
2015-03-31 104.14 23.96 65.60
2014-12-31 100.91 22.33 65.30
2014-09-30 98.01 20.31 64.84
2014-06-30 96.44 19.61 63.70
2014-03-31 91.68 17.13 63.13
2013-12-31 88.02 15.43 61.98
2013-09-30 83.50 13.52 60.74
2013-06-30 77.96 10.92 59.38
2013-03-31 81.02 13.34 58.65
2012-12-31 73.96 12.43 57.59
2012-09-30 76.52 12.28 55.63
2012-06-30 74.16 12.20 53.92
2012-03-31 70.31 10.92 51.45
2011-12-31 69.57 11.97 48.77
2011-09-30 70.77 14.31 46.48

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Meridian Bancorp has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Meridian Bancorp used its assets more efficiently than the US Mortgage industry average last year based on Return on Assets.
  • Meridian Bancorp has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Meridian Bancorp's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Mortgage industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Meridian Bancorp has a total score of 4/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

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

This company is a bank or financial institution.

Fundamentally a bank's business is based upon borrowing and lending money, for this reason they typically have high levels of debt and we analyse them differently.
Net Worth
Balance sheet
This treemap shows a more detailed breakdown of Meridian Bancorp's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Meridian Bancorp Company Filings, last reported 2 months ago.

NasdaqGS:EBSB Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-06-30 664.67 594.74 356.55
2018-03-31 655.61 582.56 362.85
2017-12-31 646.40 514.73 120.30
2017-09-30 640.40 471.07 375.49
2017-06-30 626.73 474.02 320.10
2017-03-31 616.18 334.83 407.99
2016-12-31 607.30 323.41 317.65
2016-09-30 597.06 321.44 214.90
2016-06-30 586.65 322.37 138.79
2016-03-31 582.68 212.83 248.23
2015-12-31 588.13 168.24 196.52
2015-09-30 583.10 141.19 194.27
2015-06-30 588.60 141.70 272.81
2015-03-31 583.61 145.35 359.77
2014-12-31 577.71 172.90 291.83
2014-09-30 571.04 173.28 388.96
2014-06-30 261.94 211.94 368.54
2014-03-31 254.57 202.47 157.07
2013-12-31 249.21 161.99 86.45
2013-09-30 243.65 187.93 206.44
2013-06-30 238.90 188.60 144.49
2013-03-31 239.10 186.97 183.82
2012-12-31 233.94 161.27 93.48
2012-09-30 232.68 172.41 178.36
2012-06-30 228.77 155.00 125.35
2012-03-31 224.61 138.25 165.53
2011-12-31 219.94 131.48 159.72
2011-09-30 217.40 133.48 232.35
BANK ANALYSIS

This company is a bank or financial institution, which is analysed accordingly below.

Below we check the amount of loans the bank has, how many of those are bad, and its ability to cover any bad loans.
  • Meridian Bancorp has an acceptable proportion of non-loan assets held.
  • Meridian Bancorp's liabilities are made up of primarily low risk sources of funding.
  • Loans at Meridian Bancorp are broadly funded by customer deposits.
  • Meridian Bancorp's level of assets compared to its equity is low (i.e. an appropriate level of borrowing to fund lending).
  • Meridian Bancorp has a sufficient allowance for bad loans.
  • Meridian Bancorp has an acceptable level of bad loans (less than 2%).
X
Financial health checks
We assess Meridian Bancorp's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Meridian Bancorp has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
1.16%
Current annual income from Meridian Bancorp dividends. Estimated to be 1.21% next year.
If you bought $2,000 of Meridian Bancorp shares you are expected to receive $23 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Meridian Bancorp's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.26%).
  • Meridian Bancorp's dividend is below the markets top 25% of dividend payers in United States of America (3.25%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NasdaqGS:EBSB Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 4 Analyst Estimates (S&P Global) See Below
United States of America Mortgage Industry Average Dividend Yield Market Cap Weighted Average of 104 Stocks 3.1%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 1974 Stocks 2.3%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.7%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.3%
United States of America Top 25% Dividend Yield 75th Percentile 3.3%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NasdaqGS:EBSB Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2020-12-31 0.21 3.00
2019-12-31 0.21 3.00
2018-12-31 0.20 3.00
NasdaqGS:EBSB Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2018-08-29 0.200 1.132
2018-06-01 0.200 1.056
2018-03-01 0.200 1.014
2017-12-01 0.200 0.973
2017-09-01 0.160 0.840
2017-06-01 0.160 0.941
2017-03-02 0.160 0.898
2016-12-01 0.120 0.639
2016-09-01 0.120 0.748
2016-06-01 0.120 0.797
2016-03-01 0.120 0.842
2015-12-09 0.120 0.878
2015-08-27 0.120 0.869

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Whilst dividend payments have been stable, Meridian Bancorp has been paying a dividend for less than 10 years.
  • Dividend payments have increased, but Meridian Bancorp only paid a dividend in the past 3 years.
Current Payout to shareholders
What portion of Meridian Bancorp's earnings are paid to the shareholders as a dividend.
  • Dividends paid are well covered by earnings (5x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be well covered by earnings (6.1x coverage).
X
Income/ dividend checks
We assess Meridian Bancorp's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.7%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Meridian Bancorp afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Meridian Bancorp has a total score of 2/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Richard Gavegnano, image provided by Google.
Richard Gavegnano
COMPENSATION $3,686,268
AGE 70
TENURE AS CEO 11.7 years
CEO Bio

Mr. Richard J. Gavegnano has been Chief Executive Officer of Meridian Bancorp, Inc. (formerly, Meridian Interstate Bancorp, Inc.) since 2007. Mr. Gavegnano serves as the Chief Executive Officer of Meridian Financial Services. Mr. Gavegnano has been the Chief Executive Officer and President of East Boston Savings Bank since June 2008 and March 5, 2014. Mr. Gavegnano served as the Chairman and Chief Executive Officer of Meridian Bancorp, Inc. East Boston Savings Bank of Mt. Washington Bank, A Division of East Boston Savings Bank. He served as Acting President of East Boston Savings Bank from June 2008 to January 2009. He served as Acting President of Meridian Bancorp, Inc. from June 2008 to January 2009. Mr. Gavegnano was in the investment business for 37 years with national New York Stock Exchange member firms and retired in 2006 ending his career as a Vice President of A.G. Edwards & Sons Inc. He has experience in business development, commercial real estate and investments. He has been associated with East Boston Savings Bank for 33 years serving as Corporator, Trustee and Lead Director. He has been the Chairman of Hampshire First Bank since 2006. He has been the Chairman of Meridian Financial Services and East Boston Savings Bank since 2003 and 2006 respectively. Mr. Gavegnano has been the Chairman of Meridian Bancorp, Inc. since 2006 and as its Director since 1995. He serves as a Director of East Boston Savings Bank. He serves as a Director of Hampshire First Bank. He served as a Director of Meridian Bancorp, Inc. and East Boston Savings Bank of Mt. Washington Bank, A Division of East Boston Savings Bank.

CEO Compensation
  • Richard's compensation has increased by more than 20% in the past year.
  • Richard's compensation is higher than average for a company of this size and profit level.
Management Team Tenure

Average tenure and age of the Meridian Bancorp management team in years:

6.1
Average Tenure
62
Average Age
  • The average tenure for the Meridian Bancorp management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Richard Gavegnano

TITLE
Chairman
COMPENSATION
$4M
AGE
70
TENURE
11.7 yrs

Mark Abbate

TITLE
Executive VP
COMPENSATION
$566K
AGE
62
TENURE
8.7 yrs

Ed Merritt

TITLE
Secretary & Director
COMPENSATION
$548K
AGE
58
TENURE
8.7 yrs

Frank Romano

TITLE
Executive Vice President of Corporate Banking - East Boston Savings Bank
COMPENSATION
$553K
AGE
63
TENURE
7.7 yrs

John Migliozzi

TITLE
Executive VP of Lending - East Boston Savings Bank
COMPENSATION
$582K
AGE
60

John Carroll

TITLE
Executive VP & COO
AGE
51
TENURE
4.5 yrs

Paula Cotter

TITLE
Senior Vice President of Operations & Technology
TENURE
2.3 yrs

Keith Armstrong

TITLE
Senior Vice President of Administration
COMPENSATION
$255K
AGE
65
TENURE
2.3 yrs

Eric Heath

TITLE
Senior Vice President of Human Resources

Mary Hagen

TITLE
SVP of Electronic Banking & Customer Support
TENURE
2.3 yrs
Board of Directors Tenure

Average tenure and age of the Meridian Bancorp board of directors in years:

12.2
Average Tenure
70.5
Average Age
  • The average tenure for the Meridian Bancorp board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Board of Directors

Ed Merritt

TITLE
Secretary & Director
COMPENSATION
$548K
AGE
58
TENURE
8.7 yrs

Domenic Gambardella

TITLE
Director
COMPENSATION
$377K
AGE
72
TENURE
23.7 yrs

Richard Gavegnano

TITLE
Chairman
COMPENSATION
$4M
AGE
70
TENURE
12.7 yrs

Marilyn Censullo

TITLE
Director
COMPENSATION
$226K
AGE
60
TENURE
11.7 yrs

Carl LaGreca

TITLE
Lead Director
COMPENSATION
$216K
AGE
71
TENURE
0.6 yrs

James Sartori

TITLE
Director
COMPENSATION
$280K
AGE
74
TENURE
17.7 yrs

Gregory Natalucci

TITLE
Director
COMPENSATION
$399K
AGE
72
TENURE
16.7 yrs

Anna DiMaria

TITLE
Independent Director and Director of East Boston Savings Bank
COMPENSATION
$199K
AGE
72
TENURE
12.7 yrs

Tom Gunning

TITLE
Director
COMPENSATION
$189K
AGE
64
TENURE
8.7 yrs

Russell Chin

TITLE
Director
COMPENSATION
$135K
AGE
62
TENURE
2.2 yrs
Recent Insider Trading
  • No 3 month insider trading information.
Who owns this company?
X
Management checks
We assess Meridian Bancorp's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap and profit (greater than 0.5% of the company's profit + 0.03% of market cap)? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Meridian Bancorp has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

External News
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Simply Wall St News

Who Just Sold Their Shares In Meridian Bancorp Inc (NASDAQ:EBSB)?

some insider selling over the past three months, with insiders divesting from. … It is widely considered that insider selling stock in their own companies is potentially a bearish signal. … A two-decade research published in The MIT Press (1998) showed that stocks following insider selling declined 2.7% relative to the market

Simply Wall St -

How Does Meridian Bancorp Inc's (NASDAQ:EBSB) Earnings Growth Stack Up Against Industry Performance?

Examining Meridian Bancorp Inc's (NASDAQ:EBSB) past track record of performance is a valuable exercise for investors. … Below, I will assess EBSB's latest performance announced on 30 June 2018 and weigh these figures against its longer term trend and industry movements. … EBSB's trailing twelve-month earnings (from 30 June 2018) of US$48.41m has

Simply Wall St -

With An ROE Of 7.28%, Has Meridian Bancorp Inc's (NASDAQ:EBSB) Management Done Well?

and want to learn about Return on Equity using a real-life example. … Meridian Bancorp Inc (NASDAQ:EBSB) delivered an ROE of 7.28% over the past 12 months, which is relatively in-line with its industry average of 5.96% during the same period. … Sustainability can be gauged by a company’s financial leverage – the more debt it has, the higher ROE is pumped up in the short term, at the expense of long term interest payment burden.

Simply Wall St -

Is Meridian Bancorp Inc (NASDAQ:EBSB) An Attractive Dividend Stock?

A sizeable part of portfolio returns can be produced by dividend stocks due to their contribution to compounding returns in the long run. … Over the past 3 years, Meridian Bancorp Inc (NASDAQ:EBSB) has returned an average of 1.00% per year to shareholders in terms of dividend yield. … Let's take a look at Meridian Bancorp in more detail.

Simply Wall St -

Does Meridian Bancorp Inc's (NASDAQ:EBSB) PE Ratio Warrant A Buy?

and want to better understand how you can grow your money by investing in Meridian Bancorp Inc (NASDAQ:EBSB). … Meridian Bancorp Inc (NASDAQ:EBSB) trades with a trailing P/E of 22.3x, which is lower than the industry average of 22.4x. … Although some investors may jump to the conclusion that this is a great buying opportunity, understanding the assumptions behind the P/E ratio might change your mind

Simply Wall St -

These Factors Make Meridian Bancorp Inc (NASDAQ:EBSB) A Great Investment

Building up an investment case requires looking at a stock holistically. … Today I've chosen to put the spotlight on Meridian Bancorp Inc (NASDAQ:EBSB) due to its excellent fundamentals in more than one area.

Simply Wall St -

With 25.61% Earnings Growth, Did Meridian Bancorp Inc (NASDAQ:EBSB) Outperform The Industry?

Examining Meridian Bancorp Inc's (NASDAQ:EBSB) past track record of performance is a useful exercise for investors. … Check out our latest analysis for Meridian Bancorp How Did EBSB's Recent Performance Stack Up Against Its Past? … You should continue to research Meridian Bancorp to get a more holistic view of the stock by looking at: Future Outlook: What are well-informed industry analysts predicting for EBSB’s future growth?

Simply Wall St -

Did Meridian Bancorp Inc (NASDAQ:EBSB) Create Value For Shareholders?

View our latest analysis for Meridian Bancorp Breaking down ROE — the mother of all ratios Return on Equity (ROE) is a measure of Meridian Bancorp’s profit relative to its shareholders’ equity. … Return on Equity = Net Profit ÷ Shareholders Equity ROE is measured against cost of equity in order to determine the efficiency of Meridian Bancorp’s equity capital deployed. … Since Meridian Bancorp’s return does not cover its cost, with a difference of -3.11%, this means its current use of equity is not efficient and not sustainable.

Simply Wall St -

Before You Buy Meridian Bancorp Inc's (NASDAQ:EBSB), You Should Consider This

Meridian Bancorp's beta of 0.28 indicates that the stock value will be less variable compared to the whole stock market. … Based on this beta value, EBSB appears to be a stock that an investor with a high-beta portfolio would look for to reduce risk exposure to the market. … This is an interesting conclusion, since both EBSB’s size and industry indicates the stock should have a higher beta than it currently has.

Simply Wall St -

Is It Too Late To Buy Meridian Bancorp Inc (NASDAQ:EBSB) At Its January Price?

EBSB is available at a PE (price-to-earnings) ratio of 23.3x today, which tells us the stock is overvalued based on current earnings compared to the thrifts and mortgage finance industry average of 22.56x , and overvalued compared to the US market average ratio of 19.75x. … But, seeing as Meridian Bancorp is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio. … Based on Meridian Bancorp's predicted 22.06% growth in earnings next year and PE ratio of 23.3x we see that Meridian Bancorp has a higher PEG ratio of 1.39x.

Simply Wall St -

Company Info

Map
Description

Meridian Bancorp, Inc. operates as the holding company for East Boston Savings Bank that provides various financial products and services for individuals and businesses primarily in Essex, Middlesex, Norfolk, and Suffolk Counties, Massachusetts. The company accepts various deposit products, including non-interest-bearing demand deposits, such as checking accounts; interest-bearing demand accounts comprising NOW and money market accounts; savings accounts; and certificates of deposits, as well as commercial checking accounts. Its loan portfolio includes commercial real estate loans, which are secured by properties used for business purposes, such as office buildings, industrial facilities, and retail facilities; one- to four-family residential loans comprising mortgage loans that enable borrowers to purchase or refinance existing homes; multi-family real estate loans; construction loans; commercial and industrial loans; home equity lines of credit; and consumer loans that include automobile loans, loans secured by savings or certificate accounts, credit builders, and annuity and overdraft loans. In addition, the company offers non-deposit financial products, which comprise mutual funds, annuities, stocks, and bonds through a third-party broker-dealer; and long-term care insurance products. Further, it is also involved in the securities transactions business; and holding foreclosed real estate properties. As of March 1, 2018, the company operated 33 full-service locations, as well 1 mobile branch and 3 loan centers. Meridian Bancorp, Inc. was founded in 1848 and is headquartered in Peabody, Massachusetts.

Details
Name: Meridian Bancorp, Inc.
EBSB
Exchange: NasdaqGS
Founded: 1848
$839,994,476
48,554,594
Website: http://www.ebsb.com
Address: Meridian Bancorp, Inc.
67 Prospect Street,
Peabody,
Massachusetts, 01960,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NasdaqGS EBSB Common Shares Nasdaq Global Select US USD 23. Jan 2008
DB 3MR Common Shares Deutsche Boerse AG DE EUR 23. Jan 2008
Number of employees
Current staff
Staff numbers
493
Meridian Bancorp employees.
Industry
Thrifts and Mortgage Finance
Banks
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2018/09/19 21:19
End of day share price update: 2018/09/19 00:00
Last estimates confirmation: 2018/08/03
Last earnings update: 2018/06/30
Last annual earnings update: 2017/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.