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PFBC

Preferred BankNasdaqGS:PFBC Stock Report

Market Cap

US$1.0b

7D

-5.2%

1Y

76.1%

Updated

02 Dec, 2021

Data

Company Financials +
PFBC fundamental analysis
Snowflake Score
Valuation3/6
Future Growth1/6
Past Performance4/6
Financial Health6/6
Dividends3/6

PFBC Stock Overview

Preferred Bank provides various commercial banking products and services to small and mid-sized businesses and their owners, entrepreneurs, real estate developers and investors, professionals, and high net worth individuals in the United States.

Preferred Bank Competitors

Western Alliance Bancorporation

NYSE:WAL

US$11.3b

East West Bancorp

NasdaqGS:EWBC

US$10.9b

Live Oak Bancshares

NasdaqGS:LOB

US$3.9b

Cathay General Bancorp

NasdaqGS:CATY

US$3.2b

Price History & Performance

Summary of all time highs, changes and price drops for Preferred Bank
Historical stock prices
Current Share PriceUS$67.27
52 Week HighUS$72.58
52 Week LowUS$37.07
Beta1.42
1 Month Change-5.09%
3 Month Change6.22%
1 Year Change76.10%
3 Year Change45.58%
5 Year Change41.50%
Change since IPO41.62%

Recent News & Updates

Shareholder Returns

PFBCUS BanksUS Market
7D-5.2%-7.2%-4.9%
1Y76.1%36.7%17.8%

Return vs Industry: PFBC exceeded the US Banks industry which returned 36.7% over the past year.

Return vs Market: PFBC exceeded the US Market which returned 17.8% over the past year.

Price Volatility

Is PFBC's price volatile compared to industry and market?
PFBC volatility
PFBC Average Weekly Movement3.6%
Banks Industry Average Movement3.7%
Market Average Movement6.0%
10% most volatile stocks in US Market15.1%
10% least volatile stocks in US Market2.4%

Stable Share Price: PFBC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: PFBC's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1991266Li Yuhttps://www.preferredbank.com

Preferred Bank provides various commercial banking products and services to small and mid-sized businesses and their owners, entrepreneurs, real estate developers and investors, professionals, and high net worth individuals in the United States. The company accepts checking, savings, and money market deposit accounts; fixed-rate and fixed maturity retail, and non-retail certificates of deposit; and individual retirement accounts. It also provides real estate mortgage loans that are secured by retail, industrial, office, special purpose, and residential single and multi-family properties; real estate construction loans; and commercial loans comprising lines of credit for working capital and term loans for capital expenditures, as well as equipment financing and SBA loans.

Preferred Bank Fundamentals Summary

How do Preferred Bank's earnings and revenue compare to its market cap?
PFBC fundamental statistics
Market CapUS$1.00b
Earnings (TTM)US$89.65m
Revenue (TTM)US$179.95m

11.0x

P/E Ratio

1.8x

P/B Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
PFBC income statement (TTM)
RevenueUS$179.95m
Cost of RevenueUS$0
Gross ProfitUS$179.95m
ExpensesUS$90.30m
EarningsUS$89.65m

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)6.11
Gross Margin100.00%
Net Profit Margin49.82%
Debt/Equity Ratio26.3%

How did PFBC perform over the long term?

See historical performance and comparison

Dividends

2.3%

Current Dividend Yield

24%

Payout Ratio

Valuation

Is Preferred 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: PFBC ($67.27) is trading below our estimate of fair value ($166.01)

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


Price To Earnings Ratio

PE vs Industry: PFBC is poor value based on its PE Ratio (11x) compared to the US Banks industry average (10.5x).

PE vs Market: PFBC is good value based on its PE Ratio (11x) compared to the US market (16.6x).


Price to Earnings Growth Ratio

PEG Ratio: PFBC is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: PFBC is overvalued based on its PB Ratio (1.8x) compared to the US Banks industry average (1.1x).


Future Growth

How is Preferred Bank forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

6.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PFBC's forecast earnings growth (6% per year) is above the savings rate (2%).

Earnings vs Market: PFBC's earnings (6% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: PFBC's revenue (9.5% per year) is forecast to grow slower than the US market (10.1% per year).

High Growth Revenue: PFBC's revenue (9.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PFBC's Return on Equity is forecast to be low in 3 years time (15.7%).


Past Performance

How has Preferred Bank performed over the past 5 years?

16.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PFBC has high quality earnings.

Growing Profit Margin: PFBC's current net profit margins (49.8%) are higher than last year (46.1%).


Past Earnings Growth Analysis

Earnings Trend: PFBC's earnings have grown by 16.3% per year over the past 5 years.

Accelerating Growth: PFBC's earnings growth over the past year (32.1%) exceeds its 5-year average (16.3% per year).

Earnings vs Industry: PFBC earnings growth over the past year (32.1%) underperformed the Banks industry 43%.


Return on Equity

High ROE: PFBC's Return on Equity (16%) is considered low.


Financial Health

How is Preferred 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


Financial Institutions Analysis

Asset Level: PFBC's Assets to Equity ratio (10.6x) is moderate.

Allowance for Bad Loans: PFBC has a sufficient allowance for bad loans (293%).

Low Risk Liabilities: 96% of PFBC's liabilities are made up of primarily low risk sources of funding.

Loan Level: PFBC has an appropriate level of Loans to Assets ratio (71%).

Low Risk Deposits: PFBC's Loans to Deposits ratio (82%) is appropriate.

Level of Bad Loans: PFBC has an appropriate level of bad loans (0.5%).


Dividend

What is Preferred Bank current dividend yield, its reliability and sustainability?

2.26%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: PFBC's dividend (2.26%) is higher than the bottom 25% of dividend payers in the US market (1.37%).

High Dividend: PFBC's dividend (2.26%) is low compared to the top 25% of dividend payers in the US market (3.69%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, PFBC has been paying a dividend for less than 10 years.

Growing Dividend: PFBC's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (24%), PFBC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PFBC's dividends in 3 years are forecast to be well covered by earnings (23% payout ratio).


Next Steps

Management

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

11.5yrs

Average management tenure


CEO

Li Yu (80 yo)

28.83yrs

Tenure

US$3,738,733

Compensation

Mr. Li Yu founded Preferred Bank and has been its Chairman since December 1991 and Chief Executive Officer since 1993 and served as its President from 1993 to August 22, 2012. He serves as Corporate Secret...


CEO Compensation Analysis

Compensation vs Market: Li's total compensation ($USD3.74M) is above average for companies of similar size in the US market ($USD2.31M).

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


Leadership Team

Experienced Management: PFBC's management team is seasoned and experienced (11.5 years average tenure).


Board Members

Experienced Board: PFBC's board of directors are seasoned and experienced ( 10.5 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: PFBC insiders have only sold shares 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

Preferred Bank's employee growth, exchange listings and data sources


Key Information

  • Name: Preferred Bank
  • Ticker: PFBC
  • Exchange: NasdaqGS
  • Founded: 1991
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$1.000b
  • Shares outstanding: 14.68m
  • Website: https://www.preferredbank.com

Number of Employees


Location

  • Preferred Bank
  • 601 South Figueroa Street
  • 47th and 48th Floor
  • Los Angeles
  • California
  • 90017
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/12/02 00:02
End of Day Share Price2021/12/01 00:00
Earnings2021/09/30
Annual Earnings2020/12/31


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.