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

Fundamentals

Flawless balance sheet, good value 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


Market Performance


7 Day Return

-0.4%

IBCP

1.7%

US Banks

1.3%

US Market


1 Year Return

-13.1%

IBCP

0.3%

US Banks

5.9%

US Market

Return vs Industry: IBCP underperformed the US Banks industry which returned 0.3% over the past year.

Return vs Market: IBCP underperformed the US Market which returned 5.9% over the past year.


Shareholder returns

IBCPIndustryMarket
7 Day-0.4%1.7%1.3%
30 Day-3.5%-2.4%-1.9%
90 Day-3.8%1.0%-1.8%
1 Year-10.3%-13.1%3.2%0.3%8.3%5.9%
3 Year34.8%25.0%52.1%41.7%45.6%36.2%
5 Year98.2%76.6%69.8%51.4%66.1%47.9%

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?

40.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: IBCP ($20.78) is trading below our estimate of fair value ($34.72)

Significantly Undervalued: 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 (11.7x) compared to the Banks industry average (12.5x).

PE vs Market: IBCP is good value based on its PE Ratio (11.7x) compared to the US market (17.5x).


Price to Earnings Growth Ratio

Low PEG Ratio: IBCP is poor value based on its PEG Ratio (2.2x)


Price to Book Ratio

PB vs Industry: IBCP is overvalued based on its PB Ratio (1.4x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

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

5.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: IBCP's forecast earnings growth (5.4% per year) is above the savings rate (2.7%).

Earnings vs Market: IBCP's earnings (5.4% per year) are forecast to grow slower than the US market (14.4% per year).

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

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

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


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: IBCP's Return on Equity is forecast to be low in 3 years time (12.7%).


Next Steps

Past Performance

How has Independent Bank performed over the past 5 years?

15.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: IBCP's earnings have grown by 15.3% per year over the past 5 years.

Accelerating Growth: IBCP's earnings growth over the past year (58.1%) exceeds its 5-year average (15.3% per year).

Earnings vs Industry: IBCP earnings growth over the past year (58.1%) exceeded the Banks industry 31.8%.


Return on Equity

High ROE: IBCP's Return on Equity (12.7%) is considered low.


Return on Assets

ROA vs Industry: IBCP has a higher Return on Assets than the Banks industry average last year.


Return on Capital Employed

ROCE Improving: Insufficient data to calculate IBCP's Return on Capital Employed to determine if it has improved over the past 3 years.


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 1.622450x 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 (0.27%)


Next Steps

Dividend

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

3.46%

Current Dividend Yield


Dividend Yield vs Market

company3.5%marketbottom25%1.5%markettop25%3.8%industryaverage3.1%forecastin3Years3.6%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: IBCP's dividend (3.46%) is higher than the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: IBCP's dividend (3.46%) is low compared to the top 25% of dividend payers in the US market (3.77%).

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 (37.3%), 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 (39.8% payout ratio).


Next Steps

Management

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

12.1yrs

Average management tenure


CEO

Brad Kessel (55yo)

6.8yrs

Tenure

US$1,103,298

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 ($USD1.10M) is below average for companies of similar size in the US market ($USD1.83M).

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


Management Age and Tenure

12.1yrs

Average Tenure

59.5yo

Average Age

Experienced Management: IBCP's management team is seasoned and experienced (12.1 years average tenure).


Board Age and Tenure

5.0yrs

Average Tenure

58.5yo

Average Age

Experienced Board: IBCP's board of directors are considered experienced (5 years average tenure).


Insider Trading

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


Recent Insider Transactions

BuyUS$19,56506 Sep 19
Patrick Ervin
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Mortgage Banking
Shares1,000
Max PriceUS$19.56
SellUS$14,520,00022 May 19
PL Capital Advisors, LLC
EntityCompany
Shares660,000
Max PriceUS$22.00
SellUS$122,19326 Feb 19
Robert Shuster
EntityIndividual
Role
Chief Financial Officer
Executive VP
Shares5,255
Max PriceUS$23.25
BuyUS$89,42210 Dec 18
Michael Magee
EntityIndividual
Role
Chairman of the Board
Chairman of the Board
Shares3,892
Max PriceUS$23.00
BuyUS$21,89930 Oct 18
Patrick Ervin
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Mortgage Banking
Shares1,000
Max PriceUS$21.90

Ownership Breakdown


Management Team

  • David Reglin (60yo)

    Executive Vice President of Retail Banking

    • Tenure: 12.1yrs
    • Compensation: US$158.40k
  • Rob Shuster (61yo)

    Executive VP

    • Tenure: 18.8yrs
    • Compensation: US$560.04k
  • Peter Graves (62yo)

    Chief Information Officer & Senior VP of Commercial Loans

    • Tenure: 20.8yrs
  • Brad Kessel (55yo)

    President

    • Tenure: 6.8yrs
    • Compensation: US$1.10m
  • Laurinda Neve (67yo)

    Senior Vice President of Human Resources

    • Tenure: 0yrs
  • Charles Schadler (70yo)

    Senior Vice President of Corporate Auditor

    • Tenure: 14.8yrs
  • Stefanie Kimball (59yo)

    Executive VP & Chief Risk Officer

    • Tenure: 12.5yrs
    • Compensation: US$543.61k
  • Pat Ervin (53yo)

    Executive Vice President of Mortgage Banking

    • Tenure: 3.2yrs
    • Compensation: US$550.49k
  • Jim Mack (57yo)

    Executive VP & Chief Lending Officer

    • Tenure: 7.3yrs
    • Compensation: US$534.88k
  • Larry Daniel (55yo)

    Executive Vice President of Operations & Digital Banking

    • Tenure: 1.9yrs

Board Members

  • Mike Magee (63yo)

    Chairman of the Board

    • Tenure: 8.5yrs
    • Compensation: US$72.00k
  • Stephen Gulis (62yo)

    Director

    • Tenure: 14.9yrs
    • Compensation: US$65.00k
  • Matt Missad (58yo)

    Director

    • Tenure: 5yrs
    • Compensation: US$57.00k
  • Terry Haske (71yo)

    Director

    • Tenure: 23.8yrs
    • Compensation: US$57.00k
  • Bill Boer (64yo)

    Lead Director

    • Tenure: 0yrs
    • Compensation: US$63.00k
  • Brad Kessel (55yo)

    President

    • Tenure: 6.8yrs
    • Compensation: US$1.10m
  • Joan Budden (57yo)

    Director

    • Tenure: 4.3yrs
    • Compensation: US$63.00k
  • Terry Beia (59yo)

    Director

    • Tenure: 1.5yrs
    • Compensation: US$42.75k
  • Christina Keller (37yo)

    Director

    • Tenure: 2.8yrs
    • Compensation: US$57.00k
  • Mike Cok (57yo)

    Director

    • Tenure: 2.3yrs
    • Compensation: US$57.00k

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$467.540m
  • Shares outstanding: 22.50m
  • 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 a ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 23:36
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
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.