NYSE:TFC

Stock Analysis Report

Executive Summary

Truist Financial Corporation, a holding company, provides banking and trust services for small and mid-size businesses, public agencies, local governments, corporations, and individuals in the Southeastern and Mid-Atlantic United States.

Rewards

Trading at 23.5% below its fair value

Earnings are forecast to grow 24.96% per year

Risk Analysis

Unstable dividend track record

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Flawless balance sheet with high growth potential.


Similar Companies

M&T Bank

NYSE:MTB

Share Price & News

How has Truist Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.5%

TFC

-1.5%

US Banks

0.06%

US Market


1 Year Return

5.7%

TFC

9.7%

US Banks

19.4%

US Market

Return vs Industry: TFC underperformed the US Banks industry which returned 12.1% over the past year.

Return vs Market: TFC underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

TFCIndustryMarket
7 Day-1.5%-1.5%0.06%
30 Day-4.1%-2.8%1.1%
90 Day-0.7%0.3%8.9%
1 Year9.4%5.7%12.9%9.7%21.9%19.4%
3 Year23.5%12.5%22.5%13.7%48.9%39.3%
5 Year64.6%41.3%72.4%52.8%71.9%53.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Truist Financial undervalued compared to its fair value and its price relative to the market?

24.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TFC ($54.94) is trading below our estimate of fair value ($71.85)

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


Price To Earnings Ratio

PE vs Industry: TFC is poor value based on its PE Ratio (14.6x) compared to the Banks industry average (12.6x).

PE vs Market: TFC is good value based on its PE Ratio (14.6x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: TFC is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: TFC is overvalued based on its PB Ratio (1.2x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Truist Financial forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

25.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TFC's forecast earnings growth (25% per year) is above the savings rate (1.7%).

Earnings vs Market: TFC's earnings (25% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TFC's revenue (22.6% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: TFC's revenue (22.6% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TFC's Return on Equity is forecast to be low in 3 years time (10.3%).


Next Steps

Past Performance

How has Truist Financial performed over the past 5 years?

11.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TFC has high quality earnings.

Growing Profit Margin: TFC's current net profit margins (25.3%) are lower than last year (27.9%).


Past Earnings Growth Analysis

Earnings Trend: TFC's earnings have grown by 11.3% per year over the past 5 years.

Accelerating Growth: TFC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TFC had negative earnings growth (-1.1%) over the past year, making it difficult to compare to the Banks industry average (12.2%).


Return on Equity

High ROE: TFC's Return on Equity (4.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Truist Financial'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: TFC has a low level of unsold assets or inventory.

Debt Coverage by Assets: TFC's debt is not covered by short term assets (assets are 0.6x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: TFC has an appropriate level of bad loans (0.19%)


Next Steps

Dividend

What is Truist Financial's current dividend yield, its reliability and sustainability?

3.33%

Current Dividend Yield


Dividend Yield vs Market

company3.3%marketbottom25%1.4%markettop25%3.7%industryaverage2.9%forecastin3Years3.6%

Current dividend yield vs market & industry

Notable Dividend: TFC's dividend (3.28%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: TFC's dividend (3.28%) is low compared to the top 25% of dividend payers in the US market (3.69%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.5%), TFC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TFC's dividends in 3 years are forecast to be well covered by earnings (43.1% payout ratio).


Next Steps

Management

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

3.5yrs

Average management tenure


CEO

Kelly King (71yo)

11.1yrs

Tenure

US$8,584,676

Compensation

Mr. Kelly Stuart King has been Chief Executive Officer of Truist Financial Corporation since January, 2009. Mr. King serves as Chairman of the Board and Chief Executive Officer of Truist Bank. He served as ...


CEO Compensation Analysis

Compensation vs Market: Kelly's total compensation ($USD8.58M) is about average for companies of similar size in the US market ($USD10.78M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Kelly King
Chairman & CEO11.1yrsUS$8.58m0.045% $33.0m
Daryl Bible
Chief Financial Officer11.1yrsUS$3.21m0.013% $9.8m
Christopher Henson
Head of Banking & Insurance15.7yrsUS$4.07m0.018% $13.4m
Clarke Starnes
Chief Risk Officer20.1yrsUS$3.14m0.012% $9.2m
William Rogers
President0yrsno data0.068% $50.0m
Scott Case
Chief Information Officer0.2yrsno data0.00060% $442.4k
Richard Baytosh
Executive Vice President of Investor Relations1.1yrsno datano data
Ellen Fitzsimmons
Chief Legal Officer and Head of Enterprise Diversity & Human Resources0.2yrsno data0.00064% $471.9k
Brian Davis
Senior Vice President of Corporate Communications0yrsno datano data
Dontá Wilson
Chief Digital & Client Experience Officer3.5yrsno data0.0014% $1.0m

3.5yrs

Average Tenure

58yo

Average Age

Experienced Management: TFC's management team is considered experienced (3.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kelly King
Chairman & CEO11.1yrsUS$8.58m0.045% $33.0m
William Rogers
President0yrsno data0.068% $50.0m
John Howard
Chairman & CEO of BB&T Insurance Holdings0yrsno datano data
David Ratcliffe
Lead Director0.2yrsno data0.0021% $1.5m
Thomas Skains
Independent Director10.7yrsUS$262.69k0.0020% $1.5m
Dallas Clement
Director0yrsno datano data
Nido Qubein
Director29.8yrsUS$224.69k0.0039% $2.9m
Anna Cablik
Independent Director15.3yrsUS$244.69k0.0027% $2.0m
Jennifer Banner
Independent Director16.8yrsUS$267.19k0.0017% $1.2m
Charles Patton
Independent Director7.1yrsUS$270.19k0.0051% $3.7m

10.7yrs

Average Tenure

62.5yo

Average Age

Experienced Board: TFC's board of directors are seasoned and experienced ( 10.7 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: TFC insiders have sold more shares than they have bought 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 4.2%.


Top Shareholders

Company Information

Truist Financial Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Truist Financial Corporation
  • Ticker: TFC
  • Exchange: NYSE
  • Founded: 1872
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$73.739b
  • Shares outstanding: 1.34b
  • Website: https://www.truist.com

Number of Employees


Location

  • Truist Financial Corporation
  • 214 North Tryon Street
  • Charlotte
  • North Carolina
  • 28202
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TFCNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 1972
SUUDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1972
BBT *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNDec 1972
0HKHLSE (London Stock Exchange)YesCommon StockGBUSDDec 1972
TFC.PRFNYSE (New York Stock Exchange)DEP SHS RP PFD FUSUSDOct 2012
TFC.PRGNYSE (New York Stock Exchange)DEP SHS RP PFD GUSUSDApr 2013
TFC.PRHNYSE (New York Stock Exchange)DEP SHS RP PFD HUSUSDMar 2016
TFC.PRINYSE (New York Stock Exchange)DEP SHS PFD IUSUSDDec 2019
B1BT34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COM USD5BRBRLDec 2019

Biography

Truist Financial Corporation, a holding company, provides banking and trust services for small and mid-size businesses, public agencies, local governments, corporations, and individuals in the Southeastern and Mid-Atlantic United States. The company operates through four segments: Community Banking Retail and Consumer Finance, Community Banking Commercial, Insurance Holdings, and Financial Services and Commercial Finance. Its deposit products include noninterest-bearing checking, interest-bearing checking, savings, and money market deposit accounts, as well as certificates of deposit and individual retirement accounts. The company also provides funding; asset management; automobile lending; bankcard lending; consumer finance; home equity and mortgage lending; insurance, such as property and casualty, life, health, employee benefits, commercial general liability, surety, title and other insurance products; investment brokerage; mobile/online banking; and payment, lease financing, small business lending, and wealth management/private banking services. In addition, it offers association, capital market, institutional trust, insurance premium and commercial finance, international banking, leasing, merchant, commercial deposit and treasury, commercial middle market lending, floor plan lending, commercial mortgage lending, mortgage warehouse lending, private equity investment, real estate lending, and supply chain financing services. Further, the company provides retail brokerage, equity and debt underwriting, investment advice, and corporate finance, as well as facilitates the origination, trading, and distribution of fixed-income securities and equity products. As of December 31, 2018, the company operated through approximately 1,879 financial centers. The company was formerly known as BB&T Corporation and changed its name to Truist Financial Corporation in December 2019. The company was founded in 1872 and is based in Charlotte, North Carolina. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 23:52
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.