NasdaqGS:FDEF

Stock Analysis Report

First Defiance Financial

Executive Summary

First Defiance Financial Corp. operates as a unitary thrift holding company that provides community-based financial services in northwest Ohio, northeast Indiana, and southeastern Michigan.

Rewards

Trading at 28.6% below its fair value

Earnings are forecast to grow 26.64% per year

Earnings have grown 15.9% per year over the past 5 years

Risk Analysis

Unstable dividend track record



Snowflake Analysis

Flawless balance sheet, undervalued and pays a dividend.


Similar Companies

Share Price & News

How has First Defiance Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0.9%

FDEF

-0.7%

US Mortgage

-0.09%

US Market


1 Year Return

10.3%

FDEF

15.4%

US Mortgage

23.9%

US Market

Return vs Industry: FDEF underperformed the US Mortgage industry which returned 18.8% over the past year.

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


Shareholder returns

FDEFIndustryMarket
7 Day0.9%-0.7%-0.09%
30 Day3.3%-0.9%3.1%
90 Day2.1%-0.3%10.4%
1 Year13.3%10.3%17.9%15.4%26.6%23.9%
3 Year35.5%26.5%26.2%17.5%50.9%41.2%
5 Year129.1%104.8%73.1%54.4%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is First Defiance Financial undervalued compared to its fair value and its price relative to the market?

34.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FDEF ($30.74) is trading below our estimate of fair value ($43.06)

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


Price To Earnings Ratio

PE vs Industry: FDEF is good value based on its PE Ratio (12.5x) compared to the Mortgage industry average (14.2x).

PE vs Market: FDEF is good value based on its PE Ratio (12.5x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: FDEF is good value based on its PEG Ratio (0.5x)


Price to Book Ratio

PB vs Industry: FDEF is overvalued based on its PB Ratio (1.5x) compared to the US Mortgage industry average (1.1x).


Next Steps

Future Growth

How is First Defiance Financial forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

27.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FDEF's forecast earnings growth (26.6% per year) is above the savings rate (1.7%).

Earnings vs Market: FDEF's earnings (26.6% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FDEF's revenue (30.2% per year) is forecast to grow faster than the US market (7.5% per year).

High Growth Revenue: FDEF's revenue (30.2% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FDEF's Return on Equity is forecast to be low in 3 years time (10.4%).


Next Steps

Past Performance

How has First Defiance Financial performed over the past 5 years?

16.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FDEF has high quality earnings.

Growing Profit Margin: FDEF's current net profit margins (31.3%) are lower than last year (31.6%).


Past Earnings Growth Analysis

Earnings Trend: FDEF's earnings have grown by 15.9% per year over the past 5 years.

Accelerating Growth: FDEF's earnings growth over the past year (12.4%) is below its 5-year average (15.9% per year).

Earnings vs Industry: FDEF earnings growth over the past year (12.4%) underperformed the Mortgage industry 23.1%.


Return on Equity

High ROE: FDEF's Return on Equity (11.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is First Defiance Financial'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: FDEF has a low level of unsold assets or inventory.

Debt Coverage by Assets: FDEF's debt is covered by short term assets (assets are 1.2x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: FDEF has an appropriate level of bad loans (0.53%)


Next Steps

Dividend

What is First Defiance Financial's current dividend yield, its reliability and sustainability?

2.79%

Current Dividend Yield


Upcoming Dividend Payment

Purchase First Defiance Financial before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company2.8%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: FDEF's dividend (2.86%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: FDEF's dividend (2.86%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (30.2%), FDEF's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FDEF's dividends in 3 years are forecast to be well covered by earnings (37.6% payout ratio).


Next Steps

Management

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

4.2yrs

Average management tenure


CEO

Don Hileman (66yo)

6yrs

Tenure

US$1,036,640

Compensation

Mr. Donald P. Hileman, also known as Don, has been the Chief Executive Officer and President at First Defiance Financial Corp. since January 1, 2014. Mr. Hileman has been the Chief Executive Officer of Fir ...


CEO Compensation Analysis

Compensation vs Market: Don's total compensation ($USD1.04M) is below average for companies of similar size in the US market ($USD2.53M).

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


Management Age and Tenure

4.2yrs

Average Tenure

59yo

Average Age

Experienced Management: FDEF's management team is considered experienced (4.2 years average tenure).


Board Age and Tenure

6.3yrs

Average Tenure

60yo

Average Age

Experienced Board: FDEF's board of directors are considered experienced (6.3 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$21,22426 Nov 19
John Reisner
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares700
Max PriceUS$30.32
SellUS$30,02325 Nov 19
Donald Hileman
EntityIndividual
Role
Chief Executive Officer
President
Shares1,000
Max PriceUS$30.02
SellUS$45,95113 Nov 19
John Reisner
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares1,700
Max PriceUS$27.03
SellUS$89,20312 Nov 19
Timothy Harris
EntityIndividual
Shares2,831
Max PriceUS$31.51
SellUS$26,71519 Aug 19
Donald Hileman
EntityIndividual
Role
Chief Executive Officer
President
Shares1,000
Max PriceUS$26.72
BuyUS$10,01624 Jun 19
Vincent Liuzzi
EntityIndividual
Shares365
Max PriceUS$27.44
SellUS$29,08220 May 19
Donald Hileman
EntityIndividual
Role
Chief Executive Officer
President
Shares1,000
Max PriceUS$29.08
BuyUS$26,64511 Mar 19
Mark Robison
EntityIndividual
Shares887
Max PriceUS$30.04
SellUS$29,35226 Feb 19
Donald Hileman
EntityIndividual
Role
Chief Executive Officer
President
Shares1,000
Max PriceUS$29.35
SellUS$14,60013 Feb 19
Jean Hubbard
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$29.20

Ownership Breakdown

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


Management Team

  • Sheldon Brodsky (75yo)

    President of subs

    • Compensation: US$430.45k
  • Gregory Allen (55yo)

    Market Area Executive for Fort Wayne

    • Tenure: 1.8yrs
    • Compensation: US$544.76k
  • Steve Grosenbacher

    Executive VP & Property & Casualty Agent of First Insurance Group

    • Don Hileman (66yo)

      President

      • Tenure: 6yrs
      • Compensation: US$1.04m
    • Paul Nungester (45yo)

      CFO & Executive VP

      • Tenure: 0.8yrs
    • John Reisner (63yo)

      Executive VP

      • Tenure: 6.3yrs
      • Compensation: US$397.36k
    • Danielle Figley

      Corporate Secretary

      • Sharon Davis (37yo)

        Executive VP & Director of Human Resources

        • Tenure: 4.2yrs
      • Tera Murphy

        VP & Marketing Director

        • Gary Verhoff

          Compliance Officer


          Board Members

          • Douglas Burgei (64yo)

            Independent Director

            • Tenure: 24.4yrs
            • Compensation: US$49.19k
          • Don Hileman (66yo)

            President

            • Tenure: 6yrs
            • Compensation: US$1.04m
          • Barb Mitzel (66yo)

            Independent Director

            • Tenure: 11.8yrs
            • Compensation: US$48.94k
          • John Bookmyer (54yo)

            Chairman & Lead Independent Director

            • Tenure: 1.5yrs
            • Compensation: US$60.44k
          • Sam Strausbaugh (55yo)

            Independent Director

            • Tenure: 14yrs
            • Compensation: US$52.94k
          • Bob Beach (66yo)

            Director

            • Tenure: 2.9yrs
            • Compensation: US$49.44k
          • Jean Hubbard (61yo)

            Independent Director

            • Tenure: 11.8yrs
            • Compensation: US$54.44k
          • Chuck Niehaus (59yo)

            Independent Director

            • Tenure: 5.5yrs
            • Compensation: US$49.44k
          • Thomas Reineke (59yo)

            Independent Director

            • Tenure: 3.8yrs
            • Compensation: US$48.44k
          • Terri Bettinger (51yo)

            Independent Director

            • Tenure: 2yrs
            • Compensation: US$49.44k

          Company Information

          First Defiance Financial Corp.'s company bio, employee growth, exchange listings and data sources


          Key Information

          • Name: First Defiance Financial Corp.
          • Ticker: FDEF
          • Exchange: NasdaqGS
          • Founded: 1995
          • Industry: Thrifts and Mortgage Finance
          • Sector: Banks
          • Market Cap: US$621.692m
          • Shares outstanding: 19.73m
          • Website: https://www.fdef.com

          Number of Employees


          Location

          • First Defiance Financial Corp.
          • 601 Clinton Street
          • Defiance
          • Ohio
          • 43512
          • United States

          Listings

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

          Biography

          First Defiance Financial Corp. operates as a unitary thrift holding company that provides community-based financial services in northwest Ohio, northeast Indiana, and southeastern Michigan. It offers checking accounts, money market accounts, savings accounts, term certificate accounts, demand deposits, and certificates of deposit, as well as certificate of deposit account registry service; and commercial real estate, commercial, consumer finance, 1-4 family residential real estate, construction, and home equity and improvement loans. The company also provides trust and wealth management, and online banking services. In addition, it sells various property and casualty, group health and life, and individual health and life insurance products. The company operates through 44 full service banking centers and 1 loan production office. First Defiance Financial Corp. was incorporated in 1995 and is headquartered in Defiance, Ohio. 


          Company Analysis and Financial Data Status

          All financial data provided by Standard & Poor's Capital IQ.
          DataLast Updated (UTC time)
          Company Analysis2020/01/23 23:39
          End of Day Share Price2020/01/23 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.