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FULT

Fulton Financial NasdaqGS:FULT Stock Report

Last Price

US$16.18

Market Cap

US$2.7b

7D

-2.5%

1Y

3.3%

Updated

28 Sep, 2022

Data

Company Financials +
FULT fundamental analysis
Snowflake Score
Valuation4/6
Future Growth2/6
Past Performance3/6
Financial Health6/6
Dividends5/6

FULT Stock Overview

Fulton Financial Corporation operates as a financial holding company that provides consumer and commercial banking products and services.

Fulton Financial Corporation Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Fulton Financial
Historical stock prices
Current Share PriceUS$16.18
52 Week HighUS$19.17
52 Week LowUS$13.72
Beta0.81
1 Month Change-1.82%
3 Month Change11.97%
1 Year Change3.32%
3 Year Change2.44%
5 Year Change-13.71%
Change since IPO327.16%

Recent News & Updates

Sep 20

Fulton Financial declares $0.15 dividend

Fulton Financial (NASDAQ:FULT) declares $0.15/share quarterly dividend, in line with previous. Forward yield 3.58% Payable Oct. 17; for shareholders of record Oct. 3; ex-div Sept. 30. See FULT Dividend Scorecard, Yield Chart, & Dividend Growth.

Aug 17
Do Fulton Financial's (NASDAQ:FULT) Earnings Warrant Your Attention?

Do Fulton Financial's (NASDAQ:FULT) Earnings Warrant Your Attention?

Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks...

Aug 05

Fulton Financial: Acquisition Benefits, Organic Growth To Lift Earnings

The recent acquisition of Prudential Bancorp will boost the loan book size and lead to material cost savings. Robust commercial loan pipelines and team expansion plans bode well for organic loan growth. The rising interest-rate environment will lift the margin but at the same time reduce the equity book value per share, which will hurt valuation. The December 2022 target price suggests a significant upside from the current market price. Further, FULT is offering a high dividend yield for a bank holding company. The recent acquisition of Prudential Bancorp will boost the earnings of Fulton Financial Corporation (FULT) through the end of 2023. Further, earnings will benefit from continued organic loan growth. On the other hand, higher provisioning expenses will likely drag earnings. Overall, I'm expecting Fulton Financial to report earnings of around $1.68 per share for 2022, up 3% year-over-year. For 2023, I'm expecting the company to report earnings of $1.79 per share. The year-end target price suggests a high upside from the current market price. Therefore, I'm upgrading Fulton Financial to a buy rating. Acquisition to be an Important Catalyst for Earnings Through 2023 Fulton Financial completed the acquisition of Prudential Bancorp on July 1, 2022, as recently announced. The acquisition expanded Fulton's presence in Pennsylvania, according to details given in the merger presentation. Further, the acquisition added loans totaling around $594 million, resulting in a 3% boost to Fulton's loan portfolio. However, the biggest benefit from the acquisition will be the cost savings. The management expects to save 45% of Prudential's operating expenses following the merger, with around 80% phased in this year and 100% thereafter. On the other hand, the acquisition will likely lower the net interest margin. As mentioned in the presentation, Prudential had a margin of 2.32% in the fourth quarter of 2021, which was much below Fulton's margin of 2.77%. Further, the acquisition will have a dilution effect as Fulton has issued around 6 million shares to Prudential Bancorp’s shareholders. Outlook on Organic Loan Growth is also Bright The loan portfolio surged by 2.4% in the second quarter of 2022, or 9.7% annualized, which is the highest quarterly loan growth since the second quarter of 2020. The management appeared optimistic about commercial loan growth in the latest conference call. According to the management, the pipelines have remained strong, which will support growth in the segment in the near term. Further, the management intends to expand the commercial loan team. Moreover, line utilization is likely to improve, which will boost the outstanding loan balances. As mentioned in the conference call, the management is foreseeing the excess liquidity of businesses to dry up, which it believes will lower deposits but also improve the line of credit utilization. However, the outlook for consumer loan growth is not that bright. Higher interest rates are likely to hurt this segment the most as individual borrowers will likely put off borrowing until a time when rates are lower. The Federal Reserve projects rates to start declining from next year. Overall, I'm expecting the loan portfolio to grow by 9.5% in 2022. Loan growth will likely return to the usual mid-single-digit range for 2023 in the absence of another M&A transaction. Meanwhile, the rising interest-rate environment will compress equity book value per share. This is because higher rates will reduce the value of fixed-rate securities, thereby increasing the accumulated unrealized loss on securities, which will flow directly to the equity account bypassing the income statement. The following table shows my balance sheet estimates. FY18 FY19 FY20 FY21 FY22E FY23E Financial Position Net Loans 16,004 16,674 18,623 18,076 19,802 20,606 Growth of Net Loans 2.6% 4.2% 11.7% (2.9)% 9.5% 4.1% Other Earning Assets 3,056 3,291 5,244 5,728 4,747 4,940 Deposits 16,376 17,394 20,839 21,573 22,423 23,334 Borrowings and Sub-Debt 1,747 1,765 1,926 1,038 1,064 1,108 Common equity 2,248 2,342 2,424 2,520 2,402 2,582 Book Value Per Share ($) 12.7 14.0 14.9 15.4 14.3 15.3 Tangible BVPS ($) 9.7 10.8 11.6 12.1 11.1 12.1 Source: SEC Filings, Author's Estimates (In USD million unless otherwise specified) Unlike BVPS, Margin to Benefit from a Rising-Rate Environment The management expects its loan book to be much more rate-sensitive than the deposit book. As mentioned in the conference call, the management estimates its deposit beta to be around 15% to 20%, and the loan beta to be much higher at above 40%. The management's interest-rate sensitivity analysis given in the first quarter’s 10-Q filing showed that a 200-basis points hike in interest rates could boost the net interest income by 11.4% over twelve months. However, this analysis assumes a rate shock. As the interest rate hike this year has been more of a gradual ramp, the effect of the hike on net interest income will be much lower than 11.4%. Overall, I'm expecting the net interest margin to improve by 30 basis points in the last two quarters of 2022 from 3.04% in the second quarter of the year. This estimate includes the impact of the Prudential acquisition. Further, I'm expecting the margin to remain stable in 2023 mostly due to the interest rate outlook. I'm expecting the Federal Reserve to increase the Fed Funds rate further in the remainder of the year before cutting it by mid-2023. Provisioning to be Slightly Above Normal in the Second Half of 2022 Allowances were 143% of nonperforming loans at the end of June 2022, down from 166% at the end of June 2021, according to details given in the earnings presentation. Therefore, I believe Fulton Financial will have to increase its provisioning in the year ahead. High interest rates and the possibility of a recession are likely to pressurize the portfolio’s asset quality, which will require higher provisioning in the remainder of the year. Overall, I'm expecting the net provision expense to average 0.20% annualized in the last two quarters of 2022 and all four quarters of 2023. In comparison, the net provision expense averaged 0.19% of total loans in the last five years. Expecting Slight Earnings Growth Benefits from the acquisition and organic loan growth will likely play a pivotal role in boosting earnings this year and the next. On the other hand, higher provision expenses will likely drag earnings in 2022. Further, merger-related expenses will drag earnings this year before tapering off. However, cost savings from the Prudential acquisition will curb non-interest expenses through 2023. Overall, I'm expecting Fulton Financial to report earnings of $1.68 per share for 2022, up 3% year-over-year. In 2023, I'm expecting earnings to grow by 7% to $1.79 per share. The following table shows my income statement estimates. FY18 FY19 FY20 FY21 FY22E FY23E Income Statement Net interest income 630 648 629 664 744 841 Provision for loan losses 47 33 77 (15) 15 40 Non-interest income 196 216 229 274 230 235 Non-interest expense 546 568 579 618 617 634 Net income - Common Sh. 208 226 176 265 277 301 EPS - Diluted ($) 1.18 1.35 1.08 1.62 1.68 1.79 Source: SEC Filings, Earnings Releases, Author's Estimates (In USD million unless otherwise specified) Compared to my last report on Fulton financial, I've significantly increased my earnings estimate for 2022. This is because Fulton has announced the acquisition of Prudential Bancorp since the issuance of that last report. Further, the economic outlook has changed significantly since that report.

Shareholder Returns

FULTUS BanksUS Market
7D-2.5%-4.5%-2.0%
1Y3.3%-23.8%-20.3%

Return vs Industry: FULT exceeded the US Banks industry which returned -24.8% over the past year.

Return vs Market: FULT exceeded the US Market which returned -22.1% over the past year.

Price Volatility

Is FULT's price volatile compared to industry and market?
FULT volatility
FULT Average Weekly Movement3.6%
Banks Industry Average Movement3.4%
Market Average Movement6.9%
10% most volatile stocks in US Market15.8%
10% least volatile stocks in US Market2.8%

Stable Share Price: FULT is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: FULT's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
18823,200Phil Wengerhttps://www.fultonbank.com

Fulton Financial Corporation operates as a financial holding company that provides consumer and commercial banking products and services. It accepts various checking accounts and savings deposit products, certificates of deposit, and individual retirement accounts. The company also offers secured consumer loans, including home equity loans and lines of credit, automobile loans, personal lines of credit, and checking account overdraft protection; construction and jumbo residential mortgage loans; and commercial lending products comprising commercial real estate, commercial and industrial, and construction loans, as well as equipment lease financing loans.

Fulton Financial Corporation Fundamentals Summary

How do Fulton Financial's earnings and revenue compare to its market cap?
FULT fundamental statistics
Market CapUS$2.71b
Earnings (TTM)US$261.50m
Revenue (TTM)US$913.80m

10.4x

P/E Ratio

1.2x

P/B Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
FULT income statement (TTM)
RevenueUS$913.80m
Cost of RevenueUS$0
Gross ProfitUS$913.80m
Other ExpensesUS$652.30m
EarningsUS$261.50m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)1.56
Gross Margin100.00%
Net Profit Margin28.62%
Debt/Equity Ratio47.8%

How did FULT perform over the long term?

See historical performance and comparison

Dividends

4.2%

Current Dividend Yield

36%

Payout Ratio

Does FULT pay a reliable dividends?

See FULT dividend history and benchmarks
When do you need to buy FULT by to receive an upcoming dividend?
Fulton Financial dividend dates
Ex Dividend DateSep 30 2022
Dividend Pay DateOct 17 2022
Days until Ex dividend1 day
Days until Dividend pay date18 days

Does FULT pay a reliable dividends?

See FULT dividend history and benchmarks