Enterprise Financial Services (NasdaqGS:EFSC) - Share price, News & Analysis

Q: What is the Fair Price of EFSC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

EFSC ($45.52) is trading below our estimate of [[fair value]] ($131.05)

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

EFSC Stock Overview

Enterprise Financial Services Corp operates as the financial holding company for Enterprise Bank & Trust that offers banking and wealth management services to individuals and corporate customers.

Rewards

Trading at 65.3% below our estimate of its fair value

Earnings are forecast to grow 6.37% per year

Earnings grew by 34.9% over the past year

Pays a reliable dividend of 2.02%

Trading at good value vs. industry average Price-To-Earnings ratio

Trading below our calculated fair Price-To-Earnings ratio

Risk Analysis

No risks detected for EFSC from our risk checks.

Enterprise Financial Services Competitors

Sandy Spring Bancorp

NasdaqGS:SASR

US$1.7b

FB Financial

NYSE:FBK

US$1.9b

Triumph Bancorp

NasdaqGS:TBK

US$1.4b

Mechanics Bank

OTCPK:MCHB

US$1.6b

Price History & Performance

Summary of all time highs, changes and price drops for Enterprise Financial Services
Historical stock prices
Current Share Price	US$45.52
52 Week High	US$51.50
52 Week Low	US$39.64
Beta	1.18
1 Month Change	-4.73%
3 Month Change	6.28%
1 Year Change	1.34%
3 Year Change	11.13%
5 Year Change	7.49%
Change since IPO	313.82%

Recent News & Updates

Aug 28

Enterprise Financial Services' (NASDAQ:EFSC) Shareholders Will Receive A Bigger Dividend Than Last Year

Enterprise Financial Services Corp ( NASDAQ:EFSC ) will increase its dividend from last year's comparable payment on...

Jul 29

Enterprise Financial Services' (NASDAQ:EFSC) Dividend Will Be Increased To $0.23

Enterprise Financial Services Corp ( NASDAQ:EFSC ) has announced that it will be increasing its dividend from last...

Jul 25

Enterprise Financial Services GAAP EPS of $1.19 beats by $0.07, revenue of $125.61M beats by $3.21M

Enterprise Financial Services press release (NASDAQ:EFSC): Q2 GAAP EPS of $1.19 beats by $0.07. Revenue of $125.61M (+28.3% Y/Y) beats by $3.21M.

Shareholder Returns

	EFSC	US Banks	US Market
7D	-2.2%	-5.8%	-5.2%
1Y	1.3%	-21.7%	-23.0%

Return vs Industry: EFSC exceeded the US Banks industry which returned -21.7% over the past year.

Return vs Market: EFSC exceeded the US Market which returned -23.1% over the past year.

Price Volatility

Is EFSC's price volatile compared to industry and market?
EFSC volatility
EFSC Average Weekly Movement	3.1%
Banks Industry Average Movement	3.4%
Market Average Movement	6.9%
10% most volatile stocks in US Market	15.8%
10% least volatile stocks in US Market	2.8%

Stable Share Price: EFSC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: EFSC's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1988	1,054	Jim Lally	https://www.enterprisebank.com

Enterprise Financial Services Corp operates as the financial holding company for Enterprise Bank & Trust that offers banking and wealth management services to individuals and corporate customers. The company offers checking, savings, and money market accounts, and certificates of deposit. It also provides commercial and industrial, commercial real estate, construction and land development, residential real estate, agricultural, and consumer loans.

Enterprise Financial Services Fundamentals Summary

How do Enterprise Financial Services's earnings and revenue compare to its market cap?
EFSC fundamental statistics
Market Cap	US$1.69b
Earnings (TTM)	US$155.40m
Revenue (TTM)	US$459.10m

10.9x

P/E Ratio

1.2x

P/B Ratio

Is EFSC overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
EFSC income statement (TTM)
Revenue	US$459.10m
Cost of Revenue	US$0
Gross Profit	US$459.10m
Other Expenses	US$303.71m
Earnings	US$155.40m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	4.18
Gross Margin	100.00%
Net Profit Margin	33.85%
Debt/Equity Ratio	30.7%

How did EFSC perform over the long term?

See historical performance and comparison

Dividends

2.0%

Current Dividend Yield

20%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is EFSC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for EFSC?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for EFSC. This is calculated by dividing EFSC's market cap by their current preferred multiple.
What is EFSC's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$1.69b

EFSC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	1.7x

Price to Earnings Ratio vs Peers

How does EFSC's PE Ratio compare to its peers?

EFSC PE Ratio vs Peers

The above table shows the PE ratio for EFSC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	14.3x
SASR Sandy Spring Bancorp	8.4x	1.9%	US$1.7b
FBK FB Financial	12.5x	16.1%	US$1.9b
TBK Triumph Bancorp	12.1x	-11.8%	US$1.4b
MCHB Mechanics Bank	7.8x	n/a	US$1.6b
EFSC Enterprise Financial Services	10.9x	6.4%	US$1.7b

Price-To-Earnings vs Peers: EFSC is good value based on its Price-To-Earnings Ratio (10.9x) compared to the peer average (14.3x).

Price to Earnings Ratio vs Industry

How does EFSC's PE Ratio compare vs other companies in the US Banks Industry?

Price-To-Earnings vs Industry: EFSC is expensive based on its Price-To-Earnings Ratio (10.9x) compared to the US Banks industry average (9.7x)

Price to Earnings Ratio vs Fair Ratio

What is EFSC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

EFSC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	10.9x
Fair PE Ratio	12.7x

Price-To-Earnings vs Fair Ratio: EFSC is good value based on its Price-To-Earnings Ratio (10.9x) compared to the estimated Fair Price-To-Earnings Ratio (12.7x).

Share Price vs Fair Value

What is the Fair Price of EFSC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: EFSC ($45.52) is trading below our estimate of fair value ($131.05)

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

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

Discover undervalued companies

Future Growth

How is Enterprise Financial Services 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

6.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: EFSC's forecast earnings growth (6.4% per year) is above the savings rate (1.9%).

Earnings vs Market: EFSC's earnings (6.4% per year) are forecast to grow slower than the US market (14.7% per year).

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

Revenue vs Market: EFSC's revenue (8.5% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: EFSC's revenue (8.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: EFSC's Return on Equity is forecast to be low in 3 years time (12.3%).

Discover growth companies

Past Performance

How has Enterprise Financial Services 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

19.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: EFSC has high quality earnings.

Growing Profit Margin: EFSC's current net profit margins (33.8%) are lower than last year (34.5%).

Past Earnings Growth Analysis

Earnings Trend: EFSC's earnings have grown by 19.2% per year over the past 5 years.

Accelerating Growth: EFSC's earnings growth over the past year (34.9%) exceeds its 5-year average (19.2% per year).

Earnings vs Industry: EFSC earnings growth over the past year (34.9%) exceeded the Banks industry 8.7%.

Return on Equity

High ROE: EFSC's Return on Equity (10.9%) is considered low.

Discover strong past performing companies

Financial Health

How is Enterprise Financial Services's financial position? (This company is analysed differently as a bank or financial institution)

Financial Health Score

6/6

Financial Health Score 6/6

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: EFSC's Assets to Equity ratio (9x) is low.

Allowance for Bad Loans: EFSC has a sufficient allowance for bad loans (719%).

Low Risk Liabilities: 95% of EFSC's liabilities are made up of primarily low risk sources of funding.

Loan Level: EFSC has an appropriate level of Loans to Assets ratio (70%).

Low Risk Deposits: EFSC's Loans to Deposits ratio (82%) is appropriate.

Level of Bad Loans: EFSC has an appropriate level of bad loans (0.2%).

Discover healthy companies

Dividend

What is Enterprise Financial Services's current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

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

2.02%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: EFSC's dividend (2.02%) is higher than the bottom 25% of dividend payers in the US market (1.65%).

High Dividend: EFSC's dividend (2.02%) is low compared to the top 25% of dividend payers in the US market (4.57%).

Stability and Growth of Payments

Stable Dividend: EFSC's dividends per share have been stable in the past 10 years.

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

Current Payout to Shareholders

Earnings Coverage: With its low payout ratio (19.8%), EFSC's dividend payments are well covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: EFSC's dividends in 3 years are forecast to be well covered by earnings (18.1% payout ratio).

Discover strong dividend paying companies

Management

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

6.2yrs

Average management tenure

CEO

Jim Lally (54 yo)

6.08yrs

Tenure

US$2,450,066

Compensation

Mr. James Brian Lally, also known as Jim, is the Chief Executive Officer and Director of Enterprise Financial Services Corp (NASDAQ: EFSC) May 2, 2017 and is its President since August 9, 2016. Throughout...

CEO Compensation Analysis

Compensation vs Market: Jim's total compensation ($USD2.45M) is below average for companies of similar size in the US market ($USD5.62M).

Compensation vs Earnings: Jim's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: EFSC's management team is seasoned and experienced (6.2 years average tenure).

Board Members

Experienced Board: EFSC's board of directors are considered experienced (6.2 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

NasdaqGS:EFSC Recent Insider Transactions by Companies or Individuals
Date	Value	Name	Entity	Shares	Max Price
13 Dec 21	SellUS$1,488,360	Peter Hui	Individual	31,000	US$48.08
24 Nov 21	SellUS$6,764,800	Castle Creek Capital LLC	Company	140,000	US$48.32
23 Nov 21	SellUS$4,833,804	Castle Creek Capital LLC	Company	100,000	US$48.42

Ownership Breakdown

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

Top Shareholders

Top 25 shareholders own 54.92% of the company

Ownership	Name	Shares	Current Value	Change %	Portfolio %
6.58%	BlackRock, Inc.	2,448,668	$111.5m	0.97%	no data
6.02%	EARNEST Partners, LLC	2,239,672	$101.9m	-3.58%	0.67%
4.82%	The Vanguard Group, Inc.	1,792,442	$81.6m	-1.85%	no data
3.31%	Dimensional Fund Advisors LP	1,232,278	$56.1m	10.4%	0.01%
2.71%	Jennison Associates LLC	1,008,733	$45.9m	3.32%	0.04%
2.68%	Macquarie Investment Management Business Trust	997,341	$45.4m	4.85%	0.05%
2.63%	State Street Global Advisors, Inc.	980,280	$44.6m	-8.98%	no data
2.49%	Thrivent Investment Management, Inc.	927,367	$42.2m	2.08%	0.11%
2.26%	Wellington Management Group LLP	841,919	$38.3m	70.21%	0.01%
2.25%	Western Financial Corporation	838,239	$38.2m	-1.98%	27.56%
2.15%	William Blair Investment Management, LLC	798,400	$36.3m	-2.54%	0.07%
2.03%	Castle Creek Capital LLC	756,385	$34.4m	0%	13.39%
1.95%	PL Capital Advisors, LLC	725,046	$33.0m	0%	8.94%
1.8%	Geode Capital Management, LLC	670,314	$30.5m	-1.47%	no data
1.4%	Peter Hui	520,716	$23.7m	-0.35%	no data
1.27%	Northern Trust Global Investments	471,622	$21.5m	-1.17%	no data
1.22%	New York State Common Retirement Fund	453,965	$20.7m	-0.37%	0.03%
1.13%	Segall Bryant & Hamill, LLC	422,054	$19.2m	1.68%	0.22%
1.08%	Richard Sanborn	401,222	$18.3m	0.23%	no data
0.91%	Kennedy Capital Management, Inc.	339,765	$15.5m	1.44%	0.44%
0.9%	Janus Henderson Group plc	336,734	$15.3m	-23.8%	0.01%
0.87%	Teachers Insurance and Annuity Association-College Retirement Equities Fund	324,172	$14.8m	65.28%	0.01%
0.85%	Charles Schwab Investment Management, Inc.	315,972	$14.4m	12.53%	no data
0.81%	Enterprise Bank & Trust., Asset Management Arm	300,915	$13.7m	-1.22%	3.4%
0.8%	Principal Global Investors, LLC	296,059	$13.5m	957.5%	0.01%

Ticker	Exchange	Primary Security	Security Type	Country	Currency	Listed on
EFSC	NasdaqGS (Nasdaq Global Select)	Yes	Common Shares	US	USD	Apr 2001
GV9	DB (Deutsche Boerse AG)	Yes	Common Shares	DE	EUR	Apr 2001
EFSC.P	NasdaqGS (Nasdaq Global Select)		5% DEP PFD SR A	US	USD	Nov 2021

Data	Last Updated (UTC time)
Company Analysis	2022/09/24 00:00
End of Day Share Price	2022/09/23 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31