OZK Stock Overview
Bank OZK provides various retail and commercial banking services.
No risks detected for OZK from our risk checks.
Bank OZK Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$39.52|
|52 Week High||US$51.39|
|52 Week Low||US$34.79|
|1 Month Change||-6.28%|
|3 Month Change||4.91%|
|1 Year Change||-6.59%|
|3 Year Change||45.13%|
|5 Year Change||-17.75%|
|Change since IPO||3,341.20%|
Recent News & Updates
Bank OZK's Preferred Shares Are Now Yielding 6.6%
Summary Bank OZK released strong results in the second quarter and first semester. This confirmed the preferred dividends are very well covered. While investors wouldn't participate in potential capital gains on the common shares, the 6.6% preferred dividend yield offers a good risk/reward ratio. Introduction Back in May, I thought the preferred shares of Bank OZK (OZK) were too cheap to ignore as the preferred dividend yield had increased to approximately 6.4%. At the current share price of $17.55 for the preferred shares, trading with (OZKAP) as ticker symbol, the yield is approximately 6.6%. In this article, I will mainly focus on the sustainability of the preferred dividend yield and I would recommend you to read some of my older articles to get a better understanding of the bank's business model. OZK data by YCharts The bank performed well in the second quarter Although I'm mainly interested in the bank's preferred shares as I only own those fixed-income securities, it is obviously important to check up on how the business is doing as ultimately, the bank needs to be able to afford the preferred dividends. The increasing interest rates should help the bank to expand its net interest margin, but we also shouldn't forget inflation and an economic slowdown could weigh on the performance of the loan book, with more loans entering the 'past due' stage. Fortunately, the bank reported a very solid result in the second quarter as its interest income increased to $281.5M while the interest expenses came in at just $15.7M. This resulted in a net interest income of just over $265M, which is an increase versus the $250M in the first quarter of this year and the $241M in Q2 last year. Bank OZK Investor Relations The net interest income remains very important for Bank OZK as the bank doesn't generate a lot of revenue from its non-interest activities. As you can see above, Bank OZK only reported $26.3M in non-interest income for the quarter while the total non-interest expenses came in at $109M for a net non-interest expense of $83M. This resulted in a pre-tax and pre-loan loss provision income of approximately $183M and as the bank recorded just over $7M in provisions for credit losses, the reported pre-tax income was just under $176M resulting in a net income of $136.4M. We still need to deduct the preferred stock dividends which totalled just over $4M, resulting in a net income of $132.4M attributable to the common shareholders. This already is a good first step for the preferred shares as the preferred dividends require less than 3% of the earnings to be fully covered. Or in other words, the preferred dividend coverage level exceeds 3,000%. And looking at the liabilities side of the balance sheet, it looks like we shouldn't be too worried about the asset coverage level either. The bank has 14 million preferred shares outstanding for a total of $350M. This means that of the $4.6B in equity, approximately $4.25B ranks junior to these preferred shares. Or if we look at it from the opposite point of view, the asset coverage level is in excess of 1,300%. Bank OZK Investor Relations There's one caveat though, the balance sheet of Bank OZK contains just over $666M in goodwill and intangible assets, but even if you would exclude these from the equation, the asset coverage ratio remains very robust. The loan book remains strong The combination of a very strong preferred dividend coverage ratio and a strong asset coverage ratio is good news for the preferred shares. But the asset coverage ratio also requires a strong loan book. If suddenly half of the loan book defaults on loans, then even the preferred shares will be facing tough times as Bank OZK would have to scramble to protect its equity cushion. Fortunately, Bank OZK is running a solid balance sheet. Of the $26B in assets, almost $5B is held in cash and investment securities, so the liquidity level is pretty good. I'm mainly interested in the $18.55B loan book and particularly in the relatively low amount of loan loss allowances. Bank OZK Investor Relations Looking at the breakdown of the loan book, it's clear the non-farm and non-residential as well as the construction and development loans represent almost two-thirds of the loan book. Fortunately, the vast majority of these loans is qualified as 'pass' with just under $160M of the loans classified as 'special mention' or 'substandard'.
Bank OZK: Happy I Took That Upside - Now A 'Buy'
I wrote about Bank OZK back in January, calling this bank a "HOLD" after generating some solid returns on my investment. This proved to be the right call, but mostly due to fortuitous timing on my part, given the Ukraine situation and the overall global macro. At this valuation, OZK is slowly becoming attractive again - and I am following the company very closely. Dear readers, In this article, we're going to do a solid update on Bank OZK (OZK), a business I've been busily writing on for quite some years now. The company had excellent performance up to my last article - since that time it has underperformed the S&P 500 by quite a fair margin. OZK Article (Bank OZK) But such underperformance opens the company to all kinds of potential outperformance based on the considerably more attractive valuation we have to play with here. At least, that is the case once we ensure that the company's underperformance doesn't hail from any sort of significant fundamental deterioration. Let's take a look. Updating on Bank OZK The latest results on Bank OZK we have are the 1Q22 results, though 2Q22 are not that far off here. Once the Ukraine crisis came, and macro started to deteriorate, that's when OZK reported the company's 1Q22 results. It's unlikely that Ukraine in any way affected OZK, given its geographical exposure, which is only to American states, and primarily to a few select ones of them. Bank OZK Locations (Bank OZK IR) The company continued its superb performance, further increasing its comparative asset quality, which can be put into context using a bank's net charge-off ratio, which remains well below the overall industry average. By well below, i mean less than a third of the industry average here. Bank OZK Comparison (OZK IR) The company continues to show off favorable ratios of Non-performing loans, assets and past-due loans, all of which are significantly below the industry average going into this current situation. For most of those comparisons, OZK numbers are close to 0%. The rising interest rate will also do fantastic things to OZK's net interest income numbers - which usually are the largest category of revenue for the bank. This is already increasing, with 1Q22 NII up 6.3%. Loans are the largest category of assets to this particular bank, and the company's average loan yield has stayed above 5% despite the cheap cash situation we've been seeing for years. This is likely to increase in this new environment. The tax-equivalent yield of the company's investment securities is also rising from trough levels in 2021, and in 1Q22 these rates were up above 1.45% again. This increased exposure to investment securities is a result of the bank's high liquidity position, which meant it loaded up on high-quality (mostly short-term) securities. OZK is close to a margin leader in the industry. The bank is not far from having almost double the usual FDIC-insured institution NII margin. OZK NII (OZK IR) The core spread and cost of interest-bearing deposits are also some of the better numbers in the industry, and OZK is expecting the COIBD to start increasing substantially in 2Q22. In short, OZK is one of the most efficient banks out there. OZK has actually been officially ranked here based on FDIC quarterly banking profiles and has consistently ranked in the top decile in the industry for 20 consecutive years. If you want a bank in your portfolio, you could really go for this one - because there aren't that many better banks out there, to be perfectly clear, at least not according to those numbers. The company has issued yet more RESG loan originations, with 1Q22 levels coming in at record amounts, with originations of close to $3.15B, with a 4Q run rate of close to $10B. The bank's pipeline continues to be strong here, and repayments have been strong as well, and the company expects RESG loan repayments to exceed the record level seen in 2021. These loans are still well-diversified in both product types and industry, as well as geographies. OZK RESG (OZK IR) You can look at these numbers and see that OZK only takes on relatively conservative risk, and that the diversification here is pretty good. the company has one remaining substandard RESG loan of around $66M, an accrual credit for an SF Lots & Home Loan with an almost insane LTV of close to 85%, all of the company's loans have LTV ratios of below 69%. From that perspective, OZK is very good at managing risk, and there are limited risks to the company's loan portfolio here. The company also retains good access to high-quality and cheap capital, with a current deposit total of $21.3B, with cash and equivalents of $1.6B. The company has a baa2 from Moody's and a A- rating from Kroll, though this is only for senior unsecured debt, and it's from a smaller player. Still, it bears mentioning and considering here. Ratios are excellent. OZK ratios (OZK IR) So there are no worries for this bank that I see, that would be of news to me going into 2Q22 or this new, and riskier macro. If anything, OZK seems better prepared than other banks going into this environment and should be treated as such. On a high level, OZK is a bank that carefully outperforms. It doesn't take excessive risks (though there have been some risks in the RESG portfolio over time), and it wants to make sure that its returns continue to outperform while keeping that quality. Being a nimble player in less than half of the states in the US gives it a smaller market, and expertise in these markets. The current CEO has been in his role for going on 40+ years at this point (1979), making him one of the longest-serving managers in the entire industry. Management gets a solid "gold star" from me. Bank OZK - Valuation I wrote about OZK back all the way in 2019-2020. As we move into more uncertain times, we need to make sure that our investments are in fact well-protected - and indeed, OZK's seem to be. Bank OZK, following the 25%+ decline from my last article, is trading at around 8.5X P/E. This is along the lines of several undervalued quality companies I cover. At a 3.5% yield, OZK is perhaps a lower-yielding company on that list - but it's a very safe yield at less than 30% payout ratio, and a forecast of 1-5% annual EPS growth for the next few years. Whenever the company traded at 8X P/E, it was an excellent idea to "BUY" OZK. The current upside to OZK, based on said earnings growth and the current undervaluation, is now 67% RoR, or 23.3% annually. Now that is a pretty great upside for a bank, even if it's not as massive as some of its peers. OZK Upside (F.A.S.T Graphs) There are two ways to view OZK here. One way is to view it as an above-average Banking institution that in fact deserves a bit of a premium of around 15-16x P/E due to its outperformance. While I understand this sentiment and way of viewing the bank, I would say that expecting this ignores every public comp, as well as the no credit rating and low yield that OZK offers. Quality is excellent - but your returns could still be sub-par if you overpay for that quality. The other way to view OZK, therefore, is at a 5-6 year average discount of around 11-12X, in which case your annualized RoR is now over 20%. This is not to be underestimated in the least. Which of them is right? That depends on how you want to discount for the company's advantages and assign premiums for its strengths. Being a conservative DG investor, I prefer to discount for risks and whatever shortcomings I can find - because every company has them. The S&P global average targets are currently between $42 on the low side and $57 on the high side. The company's average based on 7 analysts is currently $47.57/share. Compare this to the company's $36.8 current share price, and you're looking at a pretty amazing upside of at least 30% from the current share price.
Bank OZK's (NASDAQ:OZK) Dividend Will Be Increased To US$0.32
Bank OZK's ( NASDAQ:OZK ) dividend will be increasing to US$0.32 on 22nd of July. Based on the announced payment, the...
|OZK||US Banks||US Market|
Return vs Industry: OZK exceeded the US Banks industry which returned -21.7% over the past year.
Return vs Market: OZK exceeded the US Market which returned -23.1% over the past year.
|OZK Average Weekly Movement||3.8%|
|Banks Industry Average Movement||3.4%|
|Market Average Movement||6.9%|
|10% most volatile stocks in US Market||15.8%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: OZK is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: OZK's weekly volatility (4%) has been stable over the past year.
About the Company
Bank OZK provides various retail and commercial banking services. It accepts various deposit products, including non-interest-bearing checking, interest bearing transaction, business sweep, savings, money market, individual retirement, and other accounts, as well as time deposits. The company also offers real estate, consumer and business purpose, indirect recreational vehicle and marine, commercial and industrial, government guaranteed, agricultural, small business, homebuilder, and affordable housing loans; business aviation and subscription financing services; and mortgage and other lending products.
Bank OZK Fundamentals Summary
|OZK fundamental statistics|
Is OZK overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|OZK income statement (TTM)|
|Cost of Revenue||US$0|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
|Earnings per share (EPS)||4.57|
|Net Profit Margin||47.88%|
How did OZK perform over the long term?See historical performance and comparison
3.2%Current Dividend Yield
Is OZK undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 5/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for OZK?
Other financial metrics that can be useful for relative valuation.
|What is OZK's n/a Ratio?|
Price to Earnings Ratio vs Peers
How does OZK's PE Ratio compare to its peers?
|OZK PE Ratio vs Peers|
|Company||PE||Estimated Growth||Market Cap|
CADE Cadence Bank
WTFC Wintrust Financial
HOMB Home Bancshares (Conway AR)
OZK Bank OZK
Price-To-Earnings vs Peers: OZK is good value based on its Price-To-Earnings Ratio (8.7x) compared to the peer average (18.5x).
Price to Earnings Ratio vs Industry
How does OZK's PE Ratio compare vs other companies in the US Banks Industry?
Price-To-Earnings vs Industry: OZK is good value based on its Price-To-Earnings Ratio (8.7x) compared to the US Banks industry average (9.7x)
Price to Earnings Ratio vs Fair Ratio
What is OZK's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PE Ratio||8.7x|
|Fair PE Ratio||12.2x|
Price-To-Earnings vs Fair Ratio: OZK is good value based on its Price-To-Earnings Ratio (8.7x) compared to the estimated Fair Price-To-Earnings Ratio (12.2x).
Share Price vs Fair Value
What is the Fair Price of OZK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: OZK ($39.52) is trading below our estimate of fair value ($118.75)
Significantly Below Fair Value: OZK is trading below fair value by more than 20%.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is less than 20% higher than the current share price.
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How is Bank OZK forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?
Future Growth Score0/6
Future Growth Score 0/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: OZK's forecast earnings growth (1.2% per year) is below the savings rate (1.9%).
Earnings vs Market: OZK's earnings (1.2% per year) are forecast to grow slower than the US market (14.7% per year).
High Growth Earnings: OZK's earnings are forecast to grow, but not significantly.
Revenue vs Market: OZK's revenue (6.2% per year) is forecast to grow slower than the US market (7.6% per year).
High Growth Revenue: OZK's revenue (6.2% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: OZK's Return on Equity is forecast to be low in 3 years time (11%).
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How has Bank OZK performed over the past 5 years?
Past Performance Score2/6
Past Performance Score 2/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: OZK has high quality earnings.
Growing Profit Margin: OZK's current net profit margins (47.9%) are lower than last year (48.8%).
Past Earnings Growth Analysis
Earnings Trend: OZK's earnings have grown by 5.6% per year over the past 5 years.
Accelerating Growth: OZK's earnings growth over the past year (2.2%) is below its 5-year average (5.6% per year).
Earnings vs Industry: OZK earnings growth over the past year (2.2%) underperformed the Banks industry 8.7%.
Return on Equity
High ROE: OZK's Return on Equity (11.9%) is considered low.
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How is Bank OZK's financial position? (This company is analysed differently as a bank or financial institution)
Financial Health Score6/6
Financial Health Score 6/6
Allowance for Bad Loans
Low Risk Liabilities
Low Risk Deposits
Level of Bad Loans
Financial Position Analysis
Debt to Equity History and Analysis
Financial Institutions Analysis
Asset Level: OZK's Assets to Equity ratio (5.6x) is low.
Allowance for Bad Loans: OZK has a sufficient allowance for bad loans (517%).
Low Risk Liabilities: 94% of OZK's liabilities are made up of primarily low risk sources of funding.
Loan Level: OZK has an appropriate level of Loans to Assets ratio (72%).
Low Risk Deposits: OZK's Loans to Deposits ratio (93%) is appropriate.
Level of Bad Loans: OZK has an appropriate level of bad loans (0.2%).
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What is Bank OZK current dividend yield, its reliability and sustainability?
Dividend Score 5/6
Future Dividend Coverage
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: OZK's dividend (3.24%) is higher than the bottom 25% of dividend payers in the US market (1.65%).
High Dividend: OZK's dividend (3.24%) is low compared to the top 25% of dividend payers in the US market (4.57%).
Stability and Growth of Payments
Stable Dividend: OZK's dividends per share have been stable in the past 10 years.
Growing Dividend: OZK's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Earnings Coverage: With its reasonably low payout ratio (27.5%), OZK's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: OZK's dividends in 3 years are forecast to be well covered by earnings (29.4% payout ratio).
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
George Gleason (68 yo)
Mr. George G. Gleason, II has been Chairman of the Board and Chief Executive Officer of Bank OZK (formerly known as Bank of the Ozarks) since 1979. Mr. Gleason’s qualifications to serve on the Board includ...
CEO Compensation Analysis
Compensation vs Market: George's total compensation ($USD5.49M) is about average for companies of similar size in the US market ($USD6.95M).
Compensation vs Earnings: George's compensation has been consistent with company performance over the past year.
Experienced Management: OZK's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.
Experienced Board: OZK's board of directors are considered experienced (6.8 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: OZK insiders have only sold shares in the past 3 months.
Recent Insider Transactions
|28 Jul 22||SellUS$34,881||Alan Jessup||Individual||893||US$39.06|
|06 Jun 22||SellUS$104,050||Peter Kenny||Individual||2,500||US$41.62|
|05 May 22||SellUS$160||Scott Trapani||Individual||4||US$40.00|
|08 Feb 22||SellUS$430,938||Catherine Freedberg||Individual||8,750||US$49.25|
|26 Jan 22||SellUS$69,192||Malcolm Hicks||Individual||1,429||US$48.42|
|25 Jan 22||SellUS$310,836||Jennifer Junker||Individual||6,452||US$48.27|
|14 Dec 21||BuyUS$26,976||Beverly Cole||Individual||600||US$44.96|
|05 Nov 21||SellUS$391,216||Gregory McKinney||Individual||8,184||US$47.83|
|01 Nov 21||SellUS$289,875||Catherine Freedberg||Individual||6,250||US$46.38|
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Bank OZK's employee growth, exchange listings and data sources
- Name: Bank OZK
- Ticker: OZK
- Exchange: NasdaqGS
- Founded: 1903
- Industry: Regional Banks
- Sector: Banks
- Implied Market Cap: US$4.676b
- Shares outstanding: 118.31m
- Website: https://www.ozk.com
Number of Employees
- Bank OZK
- 18000 Cantrell Road
- Little Rock
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|OZK||NasdaqGS (Nasdaq Global Select)||Yes||Common Stock||US||USD||Jul 1997|
|BO8||DB (Deutsche Boerse AG)||Yes||Common Stock||DE||EUR||Jul 1997|
|OZK *||BMV (Bolsa Mexicana de Valores)||Yes||Common Stock||MX||MXN||Jul 1997|
|OZKA.P||NasdaqGS (Nasdaq Global Select)||4.625% PER PFD A||US||USD||Oct 2021|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/09/24 00:00|
|End of Day Share Price||2022/09/23 00:00|
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.