NasdaqGM:HMNF

Stock Analysis Report

Executive Summary

HMN Financial, Inc. operates as a bank holding company for Home Federal Savings Bank that provides retail banking products and services.

Rewards

Trading at 0.03% below its fair value

Earnings grew by 42.1% over the past year

Risk Analysis

Earnings have declined by -0.34% per year over past 5 years

Shareholders have been diluted in the past year

Does not have a meaningful market cap ($96M)



Snowflake Analysis

Flawless balance sheet and good value.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.8%

HMNF

-1.8%

US Mortgage

-2.7%

US Market


1 Year Return

5.8%

HMNF

13.1%

US Mortgage

21.2%

US Market

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

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


Shareholder returns

HMNFIndustryMarket
7 Day-1.8%-1.8%-2.7%
30 Dayn/a-2.3%0.09%
90 Day-1.5%-1.8%6.9%
1 Year5.8%5.8%15.6%13.1%23.8%21.2%
3 Year11.0%11.0%25.6%17.2%48.1%38.6%
5 Year66.3%66.3%68.6%50.4%72.5%53.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

2.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HMNF ($20.84) is trading below our estimate of fair value ($20.84)

Significantly Below Fair Value: HMNF is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: HMNF is good value based on its PE Ratio (10.8x) compared to the Mortgage industry average (14.2x).

PE vs Market: HMNF is good value based on its PE Ratio (10.8x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate HMNF's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: HMNF is good value based on its PB Ratio (1.1x) compared to the US Mortgage industry average (1.1x).


Next Steps

Future Growth

How is HMN Financial forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

8.8%

Forecasted Banks industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as HMN Financial has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has HMN Financial performed over the past 5 years?

-0.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HMNF has high quality earnings.

Growing Profit Margin: HMNF's current net profit margins (23.3%) are higher than last year (17.7%).


Past Earnings Growth Analysis

Earnings Trend: HMNF's earnings have declined by -0.3% per year over the past 5 years.

Accelerating Growth: HMNF's earnings growth over the past year (42.1%) exceeds its 5-year average (-0.3% per year).

Earnings vs Industry: HMNF earnings growth over the past year (42.1%) exceeded the Mortgage industry 23.1%.


Return on Equity

High ROE: HMNF's Return on Equity (9.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is HMN 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: HMNF has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if HMNF's debt is covered by short term assets.


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: HMNF has an appropriate level of bad loans (0.25%)


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate HMNF's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate HMNF's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if HMNF's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if HMNF's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: HMNF is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of HMNF's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

9.9yrs

Average management tenure


CEO

Brad Krehbiel (60yo)

7.8yrs

Tenure

US$448,944

Compensation

Mr. Bradley C. Krehbiel, also known as Brad, has been the Chief Executive Officer at HMN Financial, Inc. since April 2012 and has been its President since April 2010. Mr. Krehbiel has been President of Hom ...


CEO Compensation Analysis

Compensation vs Market: Brad's total compensation ($USD448.94K) is about average for companies of similar size in the US market ($USD519.76K).

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


Management Age and Tenure

9.9yrs

Average Tenure

55yo

Average Age

Experienced Management: HMNF's management team is seasoned and experienced (9.9 years average tenure).


Board Age and Tenure

8.4yrs

Average Tenure

64.5yo

Average Age

Experienced Board: HMNF's board of directors are considered experienced (8.4 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.5%.


Management Team

  • Jon Eberle (53yo)

    Senior VP

    • Tenure: 16.3yrs
    • Compensation: US$326.12k
  • Cindy Hamlin

    Corporate Secretary

    • Brad Krehbiel (60yo)

      President

      • Tenure: 7.8yrs
      • Compensation: US$448.94k
    • Larry McGraw (55yo)

      Executive VP & COO of Home Federal Savings Bank

      • Tenure: 9.9yrs
      • Compensation: US$326.70k

    Board Members

    • Roger Weise (84yo)

      Director Emeritus

      • Tenure: 15.8yrs
      • Compensation: US$102.79k
    • Allen Berning (64yo)

      Independent Director

      • Tenure: 8.8yrs
      • Compensation: US$26.05k
    • Hugh Smith (79yo)

      Chairman of the Board

      • Tenure: 8.8yrs
      • Compensation: US$46.70k
    • Brad Krehbiel (60yo)

      President

      • Tenure: 7.8yrs
      • Compensation: US$448.94k
    • Bernie Nigon (70yo)

      Independent Director

      • Tenure: 8.8yrs
      • Compensation: US$29.70k
    • Mark Utz (58yo)

      Independent Director

      • Tenure: 8yrs
      • Compensation: US$22.15k
    • Wendy Shannon (65yo)

      Independent Director

      • Tenure: 6.8yrs
      • Compensation: US$29.40k
    • Mike Bue (73yo)

      Independent Director

      • Tenure: 3.8yrs
      • Compensation: US$30.85k
    • Hans Zietlow (58yo)

      Independent Director

      • Tenure: 3.8yrs
      • Compensation: US$25.25k
    • Sequoya Borgman (43yo)

      Independent Director

      • Tenure: 0.8yrs

    Company Information

    HMN Financial, Inc.'s company bio, employee growth, exchange listings and data sources


    Key Information


    Number of Employees


    Location

    • HMN Financial, Inc.
    • 1016 Civic Center Drive Northwest
    • Rochester
    • Minnesota
    • 55901
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    HMNFNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDJun 1994

    Biography

    HMN Financial, Inc. operates as a bank holding company for Home Federal Savings Bank that provides retail banking products and services. The company offers various deposit accounts, such as savings, negotiable order of withdrawal, non-interest bearing checking, money market, and certificate accounts, including individual retirement accounts. It also provides single family residential loans; commercial real estate and multi-family mortgage loans; construction and commercial business loans; and consumer loans, such as home equity, automobile, recreational vehicle, mobile home, and lot loans, as well as loans secured by deposit accounts, and other loans for household and personal purposes. In addition, the company offers financial planning products and services; and invests in mortgage-backed and related securities, the United States government agency obligations, and other permissible investments. The company operates through 14 full service branches located in Minnesota and Iowa; and 2 loan production offices located in Minnesota and Wisconsin. HMN Financial, Inc. was founded in 1934 and is based in Rochester, Minnesota. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/27 23:41
    End of Day Share Price2020/01/27 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    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.