First Republic Bank (NYSE:FRC) - Share price, News & Analysis

Q: What is the Fair Price of FRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

FRC ($163.96) is trading below our estimate of [[fair value]] ($233.27)

FRC fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	3/6
Past Performance	4/6
Financial Health	6/6
Dividends	0/6

FRC Stock Overview

First Republic Bank, together with its subsidiaries, provides private banking, private business banking, and private wealth management services to clients in metropolitan areas in the United States.

Rewards

Trading at 29.7% below our estimate of its fair value

Earnings are forecast to grow 13.68% per year

Earnings grew by 20.1% over the past year

Risk Analysis

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year

First Republic Bank Competitors

SVB Financial Group

NasdaqGS:SIVB

US$24.4b

M&T Bank

NYSE:MTB

US$31.5b

Huntington Bancshares

NasdaqGS:HBAN

US$19.4b

Fifth Third Bancorp

NasdaqGS:FITB

US$23.8b

Price History & Performance

Summary of all time highs, changes and price drops for First Republic Bank
Historical stock prices
Current Share Price	US$163.96
52 Week High	US$222.86
52 Week Low	US$133.37
Beta	1.11
1 Month Change	8.45%
3 Month Change	13.15%
1 Year Change	-19.53%
3 Year Change	73.72%
5 Year Change	68.39%
Change since IPO	487.25%

Recent News & Updates

Aug 02

First Republic Bank prices ~$353.3M stock offering

First Republic Bank (NYSE:FRC) shares dropped ~3% pre-market on Tuesday after the firm priced its underwritten public offering of 2.25M shares of its common stock at ~$157/share for expected gross proceeds of ~$353.3M. Underwriters have been granted a 30-day option to purchase up to an additional 337,500 shares from First Republic. Net proceeds from the offering will be used for general corporate purposes, which may include, among other things, funding loans or purchasing investment securities for its portfolio. The offering is expected to close on or about August 4, 2022.

Shareholder Returns

	FRC	US Banks	US Market
7D	0.8%	0.3%	1.0%
1Y	-19.5%	-14.1%	-12.9%

Return vs Industry: FRC underperformed the US Banks industry which returned -14.1% over the past year.

Return vs Market: FRC underperformed the US Market which returned -12.8% over the past year.

Price Volatility

Is FRC's price volatile compared to industry and market?
FRC volatility
FRC Average Weekly Movement	4.4%
Banks Industry Average Movement	3.7%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.1%
10% least volatile stocks in US Market	3.2%

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

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

About the Company

Founded	Employees	CEO	Website
1985	6,452	Mike Roffler	https://www.firstrepublic.com

First Republic Bank, together with its subsidiaries, provides private banking, private business banking, and private wealth management services to clients in metropolitan areas in the United States. It operates in two segments, Commercial Banking and Wealth Management. The company accepts deposit products, such as noninterest-bearing checking, interest-bearing checking, money market checking accounts, money market savings accounts, and passbook accounts, as well as certificates of deposit.

First Republic Bank Fundamentals Summary

How do First Republic Bank's earnings and revenue compare to its market cap?
FRC fundamental statistics
Market Cap	US$29.83b
Earnings (TTM)	US$1.47b
Revenue (TTM)	US$5.48b

20.3x

P/E Ratio

2.3x

P/B Ratio

Is FRC overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
FRC income statement (TTM)
Revenue	US$5.48b
Cost of Revenue	US$0
Gross Profit	US$5.48b
Other Expenses	US$4.01b
Earnings	US$1.47b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	8.07
Gross Margin	100.00%
Net Profit Margin	26.83%
Debt/Equity Ratio	74.7%

How did FRC perform over the long term?

See historical performance and comparison

Dividends

0.7%

Current Dividend Yield

12%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is FRC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for FRC?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for FRC. This is calculated by dividing FRC's market cap by their current preferred multiple.
What is FRC's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$29.83b

FRC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	1.5x

Price to Earnings Ratio vs Peers

How does FRC's PE Ratio compare to its peers?

FRC PE Ratio vs Peers

The above table shows the PE ratio for FRC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	13.9x
SIVB SVB Financial Group	15.8x	21.9%	US$24.4b
MTB M&T Bank	21.1x	13.6%	US$31.5b
HBAN Huntington Bancshares	11.7x	2.2%	US$19.4b
FITB Fifth Third Bancorp	10.3x	6.3%	US$23.8b
FRC First Republic Bank	20.3x	13.7%	US$29.8b

Price-To-Earnings vs Peers: FRC is expensive based on its Price-To-Earnings Ratio (20.3x) compared to the peer average (13.9x).

Price to Earnings Ratio vs Industry

How does FRC's PE Ratio compare vs other companies in the US Banks Industry?

Price-To-Earnings vs Industry: FRC is expensive based on its Price-To-Earnings Ratio (20.3x) compared to the US Banks industry average (9.8x)

Price to Earnings Ratio vs Fair Ratio

What is FRC'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.

FRC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	20.3x
Fair PE Ratio	16.4x

Price-To-Earnings vs Fair Ratio: FRC is expensive based on its Price-To-Earnings Ratio (20.3x) compared to the estimated Fair Price-To-Earnings Ratio (16.4x).

Share Price vs Fair Value

What is the Fair Price of FRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: FRC ($163.96) is trading below our estimate of fair value ($233.27)

Significantly Below Fair Value: FRC 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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Future Growth

How is First Republic Bank forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

13.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: FRC's forecast earnings growth (13.7% per year) is above the savings rate (1.9%).

Earnings vs Market: FRC's earnings (13.7% per year) are forecast to grow faster than the US market (12.8% per year).

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

Revenue vs Market: FRC's revenue (12.2% per year) is forecast to grow faster than the US market (7.9% per year).

High Growth Revenue: FRC's revenue (12.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: FRC's Return on Equity is forecast to be low in 3 years time (11.2%).

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Past Performance

How has First Republic Bank performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

16.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: FRC has high quality earnings.

Growing Profit Margin: FRC's current net profit margins (26.8%) are lower than last year (27.9%).

Past Earnings Growth Analysis

Earnings Trend: FRC's earnings have grown by 16.4% per year over the past 5 years.

Accelerating Growth: FRC's earnings growth over the past year (20.1%) exceeds its 5-year average (16.4% per year).

Earnings vs Industry: FRC earnings growth over the past year (20.1%) exceeded the Banks industry 9.2%.

Return on Equity

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

Discover strong past performing companies

Financial Health

How is First Republic Bank's financial position? (This company is analysed differently as a bank or financial institution)

Financial Health Score

6/6

Financial Health Score 6/6

Asset Level
Allowance for Bad Loans
Low Risk Liabilities
Loan Level
Low Risk Deposits
Level of Bad Loans

Financial Position Analysis

Debt to Equity History and Analysis

Balance Sheet

Financial Institutions Analysis

Asset Level: FRC's Assets to Equity ratio (12x) is moderate.

Allowance for Bad Loans: FRC has a sufficient allowance for bad loans (532%).

Low Risk Liabilities: 91% of FRC's liabilities are made up of primarily low risk sources of funding.

Loan Level: FRC has an appropriate level of Loans to Assets ratio (76%).

Low Risk Deposits: FRC's Loans to Deposits ratio (91%) is appropriate.

Level of Bad Loans: FRC has an appropriate level of bad loans (0.1%).

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Dividend

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

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.66%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: FRC's dividend (0.66%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.52%).

High Dividend: FRC's dividend (0.66%) is low compared to the top 25% of dividend payers in the US market (4.09%).

Stability and Growth of Payments

Stable Dividend: FRC is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: FRC is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.

Current Payout to Shareholders

Earnings Coverage: FRC is not paying a notable dividend for the US market.

Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FRC's dividend in 3 years as they are not forecast to pay a notable one for the US market.

Discover strong dividend paying companies

Management

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

7.6yrs

Average management tenure

CEO

Mike Roffler (51 yo)

0.58

Tenure

US$7,335,897

Compensation

Mr. Michael J. Roffler, also known as Mike, serves as Chief Executive Officer at First Republic Bank since March 13, 2022 and serves as its Director since January 2022. He had been the Chief Financial Offi...

CEO Compensation Analysis

Compensation vs Market: Mike 's total compensation ($USD7.34M) is below average for companies of similar size in the US market ($USD13.00M).

Compensation vs Earnings: Mike 's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: FRC's management team is seasoned and experienced (7.6 years average tenure).

Board Members

Experienced Board: FRC's board of directors are considered experienced (9.4 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: FRC insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.9%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/06 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31