NasdaqGS:IBCP

Stock Analysis Report

Executive Summary

Independent Bank Corporation operates as the holding company for Independent Bank that provides various banking services to individuals and businesses in Michigan.


Snowflake Analysis

Flawless balance sheet, undervalued and pays a dividend.


Similar Companies

Share Price & News

How has Independent Bank's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: IBCP's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

6.4%

IBCP

2.9%

US Banks

5.3%

US Market


1 Year Return

-42.0%

IBCP

-27.8%

US Banks

-10.7%

US Market

Return vs Industry: IBCP underperformed the US Banks industry which returned -27.8% over the past year.

Return vs Market: IBCP underperformed the US Market which returned -10.7% over the past year.


Shareholder returns

IBCPIndustryMarket
7 Day6.4%2.9%5.3%
30 Day-37.6%-26.3%-13.6%
90 Day-44.2%-39.3%-19.8%
1 Year-40.0%-42.0%-25.6%-27.8%-8.9%-10.7%
3 Year-31.8%-37.2%-17.1%-23.1%15.5%8.0%
5 Year11.3%-1.6%10.9%-1.7%35.2%20.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Independent Bank undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: IBCP ($12.66) is trading below our estimate of fair value ($35.65)

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


Price To Earnings Ratio

PE vs Industry: IBCP is good value based on its PE Ratio (6.2x) compared to the Banks industry average (8.9x).

PE vs Market: IBCP is good value based on its PE Ratio (6.2x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: IBCP's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: IBCP is good value based on its PB Ratio (0.8x) compared to the US Banks industry average (0.8x).


Next Steps

Future Growth

How is Independent Bank forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

-7.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: IBCP's earnings are forecast to decline over the next 3 years (-7.6% per year).

Earnings vs Market: IBCP's earnings are forecast to decline over the next 3 years (-7.6% per year).

High Growth Earnings: IBCP's earnings are forecast to decline over the next 3 years.

Revenue vs Market: IBCP's revenue is expected to decline over the next 3 years (-12% per year).

High Growth Revenue: IBCP's revenue is forecast to decline over the next 3 years (-12% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: IBCP's Return on Equity is forecast to be low in 3 years time (10.9%).


Next Steps

Past Performance

How has Independent Bank performed over the past 5 years?

20.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: IBCP has high quality earnings.

Growing Profit Margin: IBCP's current net profit margins (27.4%) are higher than last year (25.4%).


Past Earnings Growth Analysis

Earnings Trend: IBCP's earnings have grown by 20% per year over the past 5 years.

Accelerating Growth: IBCP's earnings growth over the past year (16.6%) is below its 5-year average (20% per year).

Earnings vs Industry: IBCP earnings growth over the past year (16.6%) exceeded the Banks industry 10.9%.


Return on Equity

High ROE: IBCP's Return on Equity (13.3%) is considered low.


Next Steps

Financial Health

How is Independent Bank'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: IBCP has a low level of unsold assets or inventory.

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


Financial Institutions Analysis

Asset Level: IBCP's level of assets compared to its equity is moderate.

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

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

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

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

Level of Bad Loans: IBCP has an appropriate level of bad loans (0.35%)


Next Steps

Dividend

What is Independent Bank's current dividend yield, its reliability and sustainability?

6.32%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: IBCP's dividend (6.32%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: IBCP's dividend (6.32%) is in the top 25% of dividend payers in the US market (5.37%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (35.5%), IBCP's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: IBCP's dividends in 3 years are forecast to be well covered by earnings (47.6% payout ratio).


Next Steps

Management

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

7.7yrs

Average management tenure


CEO

Brad Kessel (55yo)

7.17s

Tenure

US$1,100,995

Compensation

Mr. William Bradford Kessel has been the Chief Executive Officer at Independent Bank Corporation and its subsidiary, Independent Bank Grand Rapids, Michigan since January 1, 2013. Mr. Kessel has been the P ...


CEO Compensation Analysis

Compensation vs Market: Brad's total compensation ($USD1.10M) is about average for companies of similar size in the US market ($USD1.48M).

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


Leadership Team

NamePositionTenureCompensationOwnership
William Kessel
President7.17yrsUS$1.10m0.57% $1.6m
Stefanie Kimball
Executive VP & Chief Risk Officer12.92yrsUS$538.15k0.30% $858.0k
Patrick Ervin
Executive Vice President of Mortgage Banking3.58yrsUS$502.38k0.056% $159.9k
Dennis Mack
Executive VP & Chief Lending Officer7.67yrsUS$521.47k0.19% $535.0k
Stephen Erickson
Executive VP0.083yrno data0.048% $136.4k
Larry Daniel
Executive Vice President of Operations & Digital Banking2.33yrsno data0.078% $222.3k
Peter Graves
Chief Information Officer & Senior VP of Commercial Loans21.17yrsno datano data
Laurinda Neve
Senior Vice President of Human Resourcesno datano datano data
David Reglin
Executive Vice President of Retail Banking12.5yrsUS$462.45k0.39% $1.1m
Charles Schadler
Senior Vice President of Corporate Auditor15.17yrsno datano data

7.7yrs

Average Tenure

58yo

Average Age

Experienced Management: IBCP's management team is seasoned and experienced (7.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
William Kessel
President7.17yrsUS$1.10m0.57% $1.6m
Michael Magee
Independent Chairman of the Board8.92yrsUS$81.75k0.17% $477.6k
Stephen Gulis
Independent Director15.33yrsUS$67.25kno data
Matthew Missad
Independent Director5.42yrsUS$59.25k0.035% $100.7k
William Boer
Lead Independent Directorno dataUS$65.25k0.15% $428.3k
Joan Budden
Independent Director4.67yrsUS$65.25k0.030% $85.7k
Terance Beia
Independent Director1.92yrsUS$59.25k0.16% $467.0k
Christina Keller
Independent Director3.25yrsUS$59.25k0.031% $89.5k
Ronia Kruse
Independent Director0.42yrUS$15.00kno data
Michael Cok
Independent Director2.75yrsUS$59.25kno data

4.7yrs

Average Tenure

57.5yo

Average Age

Experienced Board: IBCP's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: IBCP insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

Independent Bank Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Independent Bank Corporation
  • Ticker: IBCP
  • Exchange: NasdaqGS
  • Founded: 1864
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$284.551m
  • Shares outstanding: 22.11m
  • Website: https://www.independentbank.com

Number of Employees


Location

  • Independent Bank Corporation
  • 4200 East Beltline
  • Grand Rapids
  • Michigan
  • 49525
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
IBCPNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDSep 1985

Biography

Independent Bank Corporation operates as the holding company for Independent Bank that provides various banking services to individuals and businesses in Michigan. The company offers checking and savings accounts, commercial lending, direct and indirect consumer financing, mortgage lending, and safe deposit box services, as well as automatic teller machines, and Internet and mobile banking services. It also provides title insurance, investment, and insurance brokerage services. The company offers its services through approximately 67 branches, 1 drive-thru facility, and 12 loan production offices. Independent Bank Corporation was founded in 1864 and is based in Grand Rapids, Michigan. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 00:21
End of Day Share Price2020/03/31 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.