NasdaqGS:VLY

Stock Analysis Report

Valley National Bancorp

Executive Summary

Valley National Bancorp operates as the holding company for the Valley National Bank that provides commercial, retail, insurance, and wealth management financial services.

Rewards

Trading at 28.9% below its fair value

Earnings are forecast to grow 16.48% per year

Earnings grew by 70% over the past year

Risk Analysis

Unstable dividend track record

Shareholders have been diluted in the past year



Snowflake Analysis

Very undervalued with flawless balance sheet and pays a dividend.


Similar Companies

Bank of America

NYSE:BAC

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.9%

VLY

-1.0%

US Banks

-0.09%

US Market


1 Year Return

10.4%

VLY

14.7%

US Banks

23.9%

US Market

Return vs Industry: VLY underperformed the US Banks industry which returned 21.7% over the past year.

Return vs Market: VLY underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

VLYIndustryMarket
7 Day-0.9%-1.0%-0.09%
30 Day-0.7%-3.0%3.1%
90 Day-2.3%4.5%10.4%
1 Year15.0%10.4%18.0%14.7%26.6%23.9%
3 Year4.5%-7.0%28.6%19.4%50.9%41.2%
5 Year52.4%24.0%86.7%65.8%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

27.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: VLY ($11.22) is trading below our estimate of fair value ($15.77)

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


Price To Earnings Ratio

PE vs Industry: VLY is good value based on its PE Ratio (11.1x) compared to the Banks industry average (12.8x).

PE vs Market: VLY is good value based on its PE Ratio (11.1x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: VLY is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: VLY is good value based on its PB Ratio (1.1x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Valley National Bancorp forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

16.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VLY's forecast earnings growth (16.5% per year) is above the savings rate (1.7%).

Earnings vs Market: VLY's earnings (16.5% per year) are forecast to grow faster than the US market (14.3% per year).

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

Revenue vs Market: VLY's revenue (9.7% per year) is forecast to grow faster than the US market (7.5% per year).

High Growth Revenue: VLY's revenue (9.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VLY's Return on Equity is forecast to be low in 3 years time (10.6%).


Next Steps

Past Performance

How has Valley National Bancorp performed over the past 5 years?

23.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: VLY has high quality earnings.

Growing Profit Margin: VLY's current net profit margins (34.9%) are higher than last year (22.6%).


Past Earnings Growth Analysis

Earnings Trend: VLY's earnings have grown significantly by 23.5% per year over the past 5 years.

Accelerating Growth: VLY's earnings growth over the past year (70%) exceeds its 5-year average (23.5% per year).

Earnings vs Industry: VLY earnings growth over the past year (70%) exceeded the Banks industry 27.1%.


Return on Equity

High ROE: VLY's Return on Equity (9.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Valley National 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: VLY has a low level of unsold assets or inventory.

Debt Coverage by Assets: VLY's debt is not covered by short term assets (assets are 0.2x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: VLY has an appropriate level of bad loans (0.38%)


Next Steps

Dividend

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

3.88%

Current Dividend Yield


Dividend Yield vs Market

company3.9%marketbottom25%1.4%markettop25%3.7%industryaverage2.8%forecastin3Years3.9%

Current dividend yield vs market & industry

Notable Dividend: VLY's dividend (3.92%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: VLY's dividend (3.92%) is in the top 25% of dividend payers in the US market (3.66%)


Stability and Growth of Payments

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

Growing Dividend: VLY's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (43.4%), VLY's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: VLY's dividends in 3 years are forecast to be well covered by earnings (42.3% payout ratio).


Next Steps

Management

What is the CEO of Valley National Bancorp's salary, the management and board of directors tenure and is there insider trading?

2.2yrs

Average management tenure


CEO

Ira Robbins (44yo)

2.1yrs

Tenure

US$3,184,919

Compensation

Mr. Ira D. Robbins, CPA has been the President of Valley National Bank at Valley National Bancorp since January 5, 2017 and serves as its Chief Executive Officer. Mr. Robbins serves as Chairman, President  ...


CEO Compensation Analysis

Compensation vs Market: Ira's total compensation ($USD3.18M) is below average for companies of similar size in the US market ($USD4.99M).

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


Management Age and Tenure

2.2yrs

Average Tenure

58yo

Average Age

Experienced Management: VLY's management team is considered experienced (2.2 years average tenure).


Board Age and Tenure

12.1yrs

Average Tenure

64yo

Average Age

Experienced Board: VLY's board of directors are seasoned and experienced ( 12.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$179,59617 Sep 19
Gerald Lipkin
EntityIndividual
Role
Chairman of the Board
Chairman of the Board
Shares16,000
Max PriceUS$11.24
SellUS$31,58914 Mar 19
Gerald Korde
EntityIndividual
Shares3,100
Max PriceUS$10.19

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.5%.


Management Team

  • Ronald Janis (70yo)

    Senior EVP

    • Tenure: 3yrs
    • Compensation: US$1.50m
  • Tom Iadanza (60yo)

    Senior EVP & Chief Banking Officer

    • Compensation: US$1.81m
  • Mike Hagedorn (52yo)

    Senior EVP & CFO

    • Tenure: 0.4yrs
  • Ira Robbins (44yo)

    President

    • Tenure: 2.1yrs
    • Compensation: US$3.18m
  • Bernadette Mueller (60yo)

    Executive VP and Corporate Social Responsibility & Senior Community Reinvestment Act Officer

    • Mitchell Crandell (48yo)

      Executive VP & Chief Accounting Officer

      • Tenure: 9yrs
    • Bob Bardusch (53yo)

      Senior EVP & COO

      • Tenure: 1.9yrs
      • Compensation: US$1.18m
    • Melissa Scofield (59yo)

      Executive VP & Chief Risk Officer

      • Tenure: 4.8yrs
    • Yvonne Surowiec (58yo)

      Executive VP & Chief Human Resources Officer

      • Tenure: 2.3yrs
    • Rick Kraemer

      First Senior VP & Investor Relations Officer

      • Tenure: 2yrs

    Board Members

    • Gerry Lipkin (78yo)

      Chairman of the Board

      • Tenure: 29.8yrs
      • Compensation: US$603.48k
    • Andrew Abramson (65yo)

      Lead Director

      • Tenure: 5.2yrs
      • Compensation: US$253.64k
    • Graham Jones (74yo)

      Director

      • Tenure: 23yrs
      • Compensation: US$195.12k
    • Jeffrey Wilks (59yo)

      Independent Director

      • Tenure: 8yrs
      • Compensation: US$181.89k
    • Eric Edelstein (70yo)

      Independent Director

      • Tenure: 16.2yrs
      • Compensation: US$206.14k
    • Michael LaRusso (73yo)

      Independent Director

      • Tenure: 15.1yrs
      • Compensation: US$187.39k
    • Ira Robbins (44yo)

      President

      • Tenure: 2.1yrs
      • Compensation: US$3.18m
    • Marc Lenner (53yo)

      Independent Director

      • Tenure: 12.1yrs
      • Compensation: US$181.89k
    • Suresh Sani (54yo)

      Independent Director

      • Tenure: 12.1yrs
      • Compensation: US$193.64k
    • Peter Baum (63yo)

      Independent Director

      • Tenure: 7.8yrs
      • Compensation: US$194.14k

    Company Information

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


    Key Information

    • Name: Valley National Bancorp
    • Ticker: VLY
    • Exchange: NasdaqGS
    • Founded: 1927
    • Industry: Regional Banks
    • Sector: Banks
    • Market Cap: US$4.583b
    • Shares outstanding: 403.80m
    • Website: https://www.valley.com

    Number of Employees


    Location

    • Valley National Bancorp
    • One Penn Plaza
    • Suite 2930
    • New York
    • New York
    • 10119
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    VLYNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJan 1980
    VNBDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1980
    VLYP.PNasdaqGS (Nasdaq Global Select)6.25% PFD SER AUSUSDJun 2015
    VLYP.ONasdaqGS (Nasdaq Global Select)5.50% PFD SER BUSUSDJul 2017
    VLYB34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 1 COM NPVBRBRLMay 2019

    Biography

    Valley National Bancorp operates as the holding company for the Valley National Bank that provides commercial, retail, insurance, and wealth management financial services. The company operates through Commercial Lending, Consumer Lending, and Investment Management segments. Its deposit products include non-interest bearing, savings, NOW, and money market accounts, as well as certificates of deposit. The company offers various loan products comprising residential mortgage loans, automobile loans, secured personal lines of credit, and home equity loans; and floating rate and adjustable rate commercial and industrial loans, as well as fixed rate owner occupied and commercial real estate loans. It also invests in securities and interest-bearing deposits with other banks; and offers international banking services, such as standby letters of credit, documentary letters of credit and related products, and other ancillary services, such as foreign exchange transactions, documentary collections, foreign wire transfers, and transaction accounts for non-resident aliens. In addition, the company provides asset management advisory, trust, and asset-based lending support services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as real estate related investments. Further, it offers other banking services comprising automated teller machine, telephone and Internet banking, remote deposit capturing, overdraft, drive-in and night deposit, and safe deposit services. The company operates approximately 200 branches in New Jersey, New York, Florida, and Alabama. Valley National Bancorp was founded in 1927 and is based in New York, New York. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/23 23:45
    End of Day Share Price2020/01/23 00:00
    Earnings2019/09/30
    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.