NasdaqGS:PACW

Stock Analysis Report

Executive Summary

PacWest Bancorp operates as the holding company for Pacific Western Bank, a state chartered bank that provides commercial banking products and services.

Rewards

Trading at 30.8% below its fair value

Earnings have grown 14.4% per year over the past 5 years

Pays a high and reliable dividend of 6.46%

Risk Analysis

Earnings are forecast to decline by an average of -5.3% per year for the next 3 years



Snowflake Analysis

Flawless balance sheet 6 star dividend payer.


Similar Companies

Share Price & News

How has PacWest Bancorp's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

1.4%

PACW

-1.5%

US Banks

0.06%

US Market


1 Year Return

-10.5%

PACW

9.7%

US Banks

19.4%

US Market

Return vs Industry: PACW underperformed the US Banks industry which returned 9.7% over the past year.

Return vs Market: PACW underperformed the US Market which returned 19.4% over the past year.


Shareholder returns

PACWIndustryMarket
7 Day1.4%-1.5%0.06%
30 Day-2.3%-2.8%1.1%
90 Day-1.2%0.3%8.9%
1 Year-4.5%-10.5%12.9%9.7%21.9%19.4%
3 Year-21.7%-33.3%22.5%13.7%48.9%39.3%
5 Year4.8%-18.7%72.4%52.8%71.9%53.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is PacWest Bancorp undervalued compared to its fair value and its price relative to the market?

30.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PACW ($37.13) is trading below our estimate of fair value ($53.65)

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


Price To Earnings Ratio

PE vs Industry: PACW is good value based on its PE Ratio (9.5x) compared to the Banks industry average (12.6x).

PE vs Market: PACW is good value based on its PE Ratio (9.5x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: PACW is good value based on its PB Ratio (0.9x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is PacWest Bancorp forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

-5.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PACW's earnings are forecast to decline over the next 3 years (-5.3% per year).

Earnings vs Market: PACW's earnings are forecast to decline over the next 3 years (-5.3% per year).

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

Revenue vs Market: PACW's revenue (0.2% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: PACW's revenue (0.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PACW's Return on Equity is forecast to be low in 3 years time (8%).


Next Steps

Past Performance

How has PacWest Bancorp performed over the past 5 years?

14.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PACW has high quality earnings.

Growing Profit Margin: PACW's current net profit margins (40.8%) are higher than last year (40.2%).


Past Earnings Growth Analysis

Earnings Trend: PACW's earnings have grown by 14.4% per year over the past 5 years.

Accelerating Growth: PACW's earnings growth over the past year (0.7%) is below its 5-year average (14.4% per year).

Earnings vs Industry: PACW earnings growth over the past year (0.7%) underperformed the Banks industry 12.3%.


Return on Equity

High ROE: PACW's Return on Equity (9.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is PacWest Bancorp'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: PACW has a low level of unsold assets or inventory.

Debt Coverage by Assets: PACW's debt is not covered by short term assets (assets are 0.3x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: PACW has an appropriate level of bad loans (0.49%)


Next Steps

Dividend

What is PacWest Bancorp's current dividend yield, its reliability and sustainability?

6.46%

Current Dividend Yield


Dividend Yield vs Market

company6.5%marketbottom25%1.4%markettop25%3.7%industryaverage2.9%forecastin3Years6.5%

Current dividend yield vs market & industry

Notable Dividend: PACW's dividend (6.46%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: PACW's dividend (6.46%) is in the top 25% of dividend payers in the US market (3.7%)


Stability and Growth of Payments

Stable Dividend: PACW's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (61.6%), PACW's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PACW's dividends in 3 years are forecast to be covered by earnings (67.5% payout ratio).


Next Steps

Management

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

3.0yrs

Average management tenure


CEO

Matt Wagner (62yo)

19.4yrs

Tenure

US$6,238,560

Compensation

Mr. Matthew P. Wagner, also known as Matt, has been President and Chief Executive Officer of PacWest Bancorp and Pacific Western Bank. Mr. Wagner is a Director of PacWest Bancorp since 2000. Mr. Wagner als ...


CEO Compensation Analysis

Compensation vs Market: Matt's total compensation ($USD6.24M) is about average for companies of similar size in the US market ($USD4.89M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Matthew Wagner
President19.4yrsUS$6.24m0.61% $26.8m
Patrick Rusnak
Executive VP & CFO4.5yrsUS$2.43m0.11% $4.6m
Mark Yung
Executive VP2.8yrsUS$142.99k0.070% $3.1m
James Pieczynski
Executive VP & Vice Chairman5.8yrsUS$2.81m0.17% $7.4m
Laird Boulden
Executive VP & President of National Lending Group5.8yrsUS$1.66m0.062% $2.7m
Bart Olson
Executive VP & Chief Accounting Officer3yrsno data0.028% $1.2m
Kori Ogrosky
Executive VP0yrsno data0.065% $2.8m
Rebecca Cordes
Executive Vice President of Human Resources1.2yrsno data0.022% $943.6k
Christopher Blake
Executive VP2.1yrsUS$2.03m0.065% $2.9m
Mark Christian
Executive Vice President of Operations & Systems Administration0.8yrsno data0.021% $898.5k

3.0yrs

Average Tenure

55.5yo

Average Age

Experienced Management: PACW's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Matthew Wagner
President19.4yrsUS$6.24m0.61% $26.8m
Mark Yung
Executive VP2.8yrsUS$142.99k0.070% $3.1m
James Pieczynski
Executive VP & Vice Chairman5.8yrsUS$2.81m0.17% $7.4m
C. Hosler
Lead Independent Director2.8yrsUS$182.99k0.040% $1.7m
Robert Stine
Independent Director20.1yrsUS$182.99k0.019% $832.3k
John Eggemeyer
Chairman of the Board19.7yrsUS$291.98k0.19% $8.1m
Susan Lester
Independent Director17.1yrsUS$182.99k0.023% $1.0m
Daniel Platt
Independent Director17.1yrsUS$142.99k0.024% $1.0m
Paul Burke
Independent Director4.3yrsUS$182.99k0.030% $1.3m
Craig Carlson
Independent Director9.3yrsUS$182.99k0.010% $440.5k

13.2yrs

Average Tenure

62yo

Average Age

Experienced Board: PACW's board of directors are seasoned and experienced ( 13.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: PACW 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

PacWest Bancorp's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PacWest Bancorp
  • Ticker: PACW
  • Exchange: NasdaqGS
  • Founded: 1999
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$4.383b
  • Shares outstanding: 118.17m
  • Website: https://www.pacwestbancorp.com

Number of Employees


Location

  • PacWest Bancorp
  • 9701 Wilshire Boulevard
  • Suite 700
  • Beverly Hills
  • California
  • 90212
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PACWNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJun 2000
F8BDB (Deutsche Boerse AG)YesCommon StockDEEURJun 2000

Biography

PacWest Bancorp operates as the holding company for Pacific Western Bank, a state chartered bank that provides commercial banking products and services. The company accepts demand, money market, and time deposits. It also provides real estate loans to professional developers and real estate investors for the acquisition, refinancing, and construction of commercial real estate properties; small business administration loans; asset-based loans for working capital needs; venture capital loans to support the start-up operations of entrepreneurial companies; and equipment-secured loans and leases. In addition, the company offers consumer loans comprising personal loans, auto loans, home equity lines of credit, revolving lines of credit, and other loans. Further, it provides international banking and multi-state deposit services; money market sweep products; investment advisory and asset management services; treasury and cash management services; telephone banking, and online and mobile banking services; and foreign exchange and ATM services. The company offers its products and services to small and mid-sized companies, entrepreneurial businesses and their venture capital, private equity investors, professionals, and other individuals. As of January 31, 2019, it had 74 full-service branches located throughout the state of California; and 1 branch in Durham, North Carolina. The company was formerly known as First Community Bancorp and changed its name to PacWest Bancorp in April 2008. PacWest Bancorp was founded in 1999 and is headquartered in Beverly Hills, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 00:47
End of Day Share Price2020/02/18 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.