NYSE:WAL

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Western Alliance Bancorporation

Executive Summary

Western Alliance Bancorporation operates as the holding company for Western Alliance Bank that provides various banking products and related services primarily in Arizona, California, and Nevada.


Snowflake Analysis

Flawless balance sheet and good value.


Similar Companies

Share Price & News

How has Western Alliance Bancorporation's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WAL's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.6%

WAL

0.8%

US Banks

4.0%

US Market


1 Year Return

-18.2%

WAL

-28.2%

US Banks

5.0%

US Market

Return vs Industry: WAL exceeded the US Banks industry which returned -28.2% over the past year.

Return vs Market: WAL underperformed the US Market which returned 5% over the past year.


Shareholder returns

WALIndustryMarket
7 Day-1.6%0.8%4.0%
30 Day-19.8%-16.5%-1.1%
90 Day12.7%7.2%21.1%
1 Year-16.2%-18.2%-25.7%-28.2%7.2%5.0%
3 Year-25.7%-27.4%-18.1%-24.7%36.0%27.1%
5 Year6.7%4.2%8.8%-4.4%65.3%46.9%

Price Volatility Vs. Market

How volatile is Western Alliance Bancorporation's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Western Alliance Bancorporation 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: WAL ($36.11) is trading below our estimate of fair value ($72.52)

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


Price To Earnings Ratio

PE vs Industry: WAL is good value based on its PE Ratio (8x) compared to the Banks industry average (9.4x).

PE vs Market: WAL is good value based on its PE Ratio (8x) compared to the US market (16.5x).


Price to Earnings Growth Ratio

PEG Ratio: WAL is poor value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: WAL is overvalued based on its PB Ratio (1.2x) compared to the US Banks industry average (0.8x).


Next Steps

Future Growth

How is Western Alliance Bancorporation forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

7.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WAL's forecast earnings growth (7.6% per year) is above the savings rate (2.2%).

Earnings vs Market: WAL's earnings (7.6% per year) are forecast to grow slower than the US market (22.8% per year).

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

Revenue vs Market: WAL's revenue (2.9% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: WAL's revenue (2.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WAL's Return on Equity is forecast to be low in 3 years time (13.5%).


Next Steps

Past Performance

How has Western Alliance Bancorporation performed over the past 5 years?

22.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WAL has high quality earnings.

Growing Profit Margin: WAL's current net profit margins (44%) are lower than last year (46.8%).


Past Earnings Growth Analysis

Earnings Trend: WAL's earnings have grown significantly by 22.8% per year over the past 5 years.

Accelerating Growth: WAL's earnings growth over the past year (1.4%) is below its 5-year average (22.8% per year).

Earnings vs Industry: WAL earnings growth over the past year (1.4%) underperformed the Banks industry 1.8%.


Return on Equity

High ROE: WAL's Return on Equity (15.4%) is considered low.


Next Steps

Financial Health

How is Western Alliance Bancorporation'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: WAL's Assets to Equity ratio (9.7x) is low.

Allowance for Bad Loans: WAL has a sufficient allowance for bad loans (217%).

Low Risk Liabilities: 95% of WAL's liabilities are made up of primarily low risk sources of funding.

Loan Level: WAL has an appropriate level of Loans to Assets ratio (79%).

Low Risk Deposits: WAL's Loans to Deposits ratio (92%) is appropriate.

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


Next Steps

Dividend

What is Western Alliance Bancorporation current dividend yield, its reliability and sustainability?

2.77%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: WAL's dividend (2.77%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: WAL's dividend (2.77%) is low compared to the top 25% of dividend payers in the US market (4.5%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether WAL's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if WAL's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (16.5%), WAL's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WAL's dividends in 3 years are forecast to be well covered by earnings (22.4% payout ratio).


Next Steps

Management

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

5.5yrs

Average management tenure


CEO

Ken Vecchione (66yo)

2.25yrs

Tenure

US$5,261,283

Compensation

Mr. Kenneth A. Vecchione, also known as Ken, has been Chief Executive Officer of Western Alliance Bancorporation and Western Alliance Bank since April 01, 2018. Mr. Vecchione served as President of Western ...


CEO Compensation Analysis

Compensation vs Market: Ken's total compensation ($USD5.26M) is about average for companies of similar size in the US market ($USD5.83M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Robert Sarver
Executive Chairman of the Board17.58yrsUS$4.62m0.91% $32.8m
Kenneth Vecchione
CEO, President & Director2.25yrsUS$5.26m0.30% $10.9m
Dale Gibbons
Vice Chairman17.17yrsUS$2.57m0.21% $7.4m
Randall Theisen
General Counsel & Secretary14.42yrsUS$1.35m0.053% $1.9m
Barbara Kennedy
Chief Human Resource Officer2.25yrsUS$1.17m0.018% $657.9k
Timothy Boothe
Chief Operating Officer0.75yrno data0.058% $2.1m
James Ardrey
Senior VP & Chief Accounting Officer8.83yrsno data0.0029% $105.7k
Jeff Semonovich
Chief Information Officerno datano datano data
Robyn Young
Executive VP & Chief Marketing Officerno datano datano data
Robert McAuslan
Executive Vice President9.25yrsUS$1.27m0.032% $1.1m

5.5yrs

Average Tenure

59.5yo

Average Age

Experienced Management: WAL's management team is seasoned and experienced (5.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Robert Sarver
Executive Chairman of the Board17.58yrsUS$4.62m0.91% $32.8m
Kenneth Vecchione
CEO, President & Director2.25yrsUS$5.26m0.30% $10.9m
Steven Hilton
Independent Director17.58yrsUS$285.65k0.13% $4.8m
Donald Snyder
Independent Director23.5yrsUS$305.65k0.11% $3.8m
Marianne Johnson
Independent Director24.75yrsUS$295.65k0.38% $13.7m
Robert Latta
Independent Director5.08yrsUS$305.65k0.046% $1.7m
Bruce Beach
Lead Independent Director10.5yrsUS$320.65k0.039% $1.4m
Sung Sohn
Independent Director9.75yrsUS$315.65k0.041% $1.5m
Howard Gould
Independent Director4.75yrsUS$305.65k0.035% $1.3m
Michael Patriarca
Independent Director3.83yrsUS$320.65k0.020% $728.3k

11.6yrs

Average Tenure

67.5yo

Average Age

Experienced Board: WAL's board of directors are seasoned and experienced ( 11.6 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if 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

Western Alliance Bancorporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Western Alliance Bancorporation
  • Ticker: WAL
  • Exchange: NYSE
  • Founded: 1994
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$3.607b
  • Shares outstanding: 99.89m
  • Website: https://www.westernalliancebancorporation.com

Number of Employees


Location

  • Western Alliance Bancorporation
  • One East Washington Street
  • Suite 1400
  • Phoenix
  • Arizona
  • 85004
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WALNYSE (New York Stock Exchange)YesCommon SharesUSUSDJun 2005
WEADB (Deutsche Boerse AG)YesCommon SharesDEEURJun 2005
WABC34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 1 COM USD0.0001BRBRLMay 2019

Biography

Western Alliance Bancorporation operates as the holding company for Western Alliance Bank that provides various banking products and related services primarily in Arizona, California, and Nevada. The company offers deposit products, including checking accounts, savings accounts, and money market accounts, as well as fixed-rate and fixed maturity certificates of deposit accounts. It also offers commercial and industrial loan products, such as working capital lines of credit, inventory and accounts receivable lines, mortgage warehouse lines, equipment loans and leases, and other commercial loans; commercial real estate loans, which are secured by multi-family residential properties, professional offices, industrial facilities, retail centers, hotels, and other commercial properties; construction and land development loans for single family and multi-family residential projects, industrial/warehouse properties, office buildings, retail centers, medical office facilities, and residential lot developments; and consumer loans. In addition, the company provides other financial services, such as Internet banking, wire transfers, electronic bill payment and presentment, lock box services, courier, and cash management services. Further, it holds certain investment securities, municipal and non-profit loans, and leases; invests primarily in low income housing tax credits and small business investment corporations; and holds certain real estate loans and related securities. As of December 31, 2018, the company operated 38 branch locations and 11 loan production offices. Western Alliance Bancorporation was founded in 1994 and is headquartered in Phoenix, Arizona. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/06 23:56
End of Day Share Price2020/07/06 00:00
Earnings2020/03/31
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.