NYSE:WAL

Stock Analysis Report

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.

Rewards

Trading at 49.9% below its fair value

Earnings are forecast to grow 3.84% per year

Earnings have grown 25% per year over the past 5 years

Risk Analysis

Unstable dividend track record



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 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.0%

WAL

3.4%

US Banks

1.3%

US Market


1 Year Return

41.1%

WAL

26.8%

US Banks

19.4%

US Market

Return vs Industry: WAL exceeded the US Banks industry which returned 26.8% over the past year.

Return vs Market: WAL exceeded the US Market which returned 19.4% over the past year.


Shareholder returns

WALIndustryMarket
7 Day4.0%3.4%1.3%
30 Day8.6%3.8%2.6%
90 Day18.3%10.7%5.0%
1 Year42.6%41.1%30.6%26.8%22.0%19.4%
3 Year16.3%15.0%33.9%24.5%46.8%37.3%
5 Year106.6%104.3%76.7%57.0%66.3%48.0%

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?

49.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WAL ($55.93) is trading below our estimate of fair value ($111.69)

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 (11.8x) compared to the Banks industry average (12.9x).

PE vs Market: WAL is good value based on its PE Ratio (11.8x) compared to the US market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: WAL is poor value based on its PEG Ratio (3.1x)


Price to Book Ratio

PB vs Industry: WAL is overvalued based on its PB Ratio (1.9x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Western Alliance Bancorporation forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

3.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WAL's forecast earnings growth (3.8% per year) is above the savings rate (1.7%).

Earnings vs Market: WAL's earnings (3.8% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: WAL's revenue (7.9% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: WAL's revenue (7.9% 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 (15.7%).


Next Steps

Past Performance

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

25.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WAL has high quality earnings.

Growing Profit Margin: WAL's current net profit margins (46.5%) are higher than last year (44.9%).


Past Earnings Growth Analysis

Earnings Trend: WAL's earnings have grown significantly by 25% per year over the past 5 years.

Accelerating Growth: WAL's earnings growth over the past year (20.7%) is below its 5-year average (25% per year).

Earnings vs Industry: WAL earnings growth over the past year (20.7%) underperformed the Banks industry 27.1%.


Return on Equity

High ROE: WAL's Return on Equity (16.8%) is considered low.


Return on Assets


Return on Capital Employed


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

Inventory Level: WAL has a low level of unsold assets or inventory.

Debt Coverage by Assets: WAL's debt is covered by short term assets (assets are 1.9x debt).


Financial Institutions Analysis

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

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

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

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

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

Level of Bad Loans: WAL has an appropriate level of bad loans (0.47%)


Next Steps

Dividend

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

1.79%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years1.5%

Current dividend yield vs market & industry

Notable Dividend: WAL's dividend (1.79%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: WAL's dividend (1.79%) is low compared to the top 25% of dividend payers in the US market (3.68%).


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 (5.3%), WAL's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WAL's dividends in 3 years are forecast to be well covered by earnings (19.4% payout ratio).


Next Steps

Management

What is the CEO of Western Alliance Bancorporation's salary, the management and board of directors tenure and is there insider trading?

6.3yrs

Average management tenure


CEO

Ken Vecchione (65yo)

0.08yrs

Tenure

US$4,830,831

Compensation

Mr. Kenneth A. Vecchione, also known as Ken, has been Chief Executive Officer of Western Alliance Bancorporation since November 1, 2019 and Western Alliance Bank since April 01, 2018. Mr. Vecchione has bee ...


CEO Compensation Analysis

Compensation vs Market: Ken's total compensation ($USD4.83M) is about average for companies of similar size in the US market ($USD6.67M).

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


Management Age and Tenure

6.3yrs

Average Tenure

59yo

Average Age

Experienced Management: WAL's management team is seasoned and experienced (6.3 years average tenure).


Board Age and Tenure

14.6yrs

Average Tenure

68.5yo

Average Age

Experienced Board: WAL's board of directors are seasoned and experienced ( 14.6 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$1,523,60005 Nov 19
Todd Marshall
EntityIndividual
Shares30,000
Max PriceUS$52.00
SellUS$999,80001 Nov 19
Todd Marshall
EntityIndividual
Shares20,000
Max PriceUS$49.99
BuyUS$113,12521 Jun 19
William Boyd
EntityIndividual
Shares2,500
Max PriceUS$45.25
SellUS$3,099,25526 Apr 19
Robert Sarver
EntityIndividual
Role
Chairman of the Board
Executive Chairman of the Board
Shares66,351
Max PriceUS$46.71
SellUS$89,94019 Mar 19
Robert McAuslan
EntityIndividual
Role
Senior Key Executive
Executive Vice President
Shares2,000
Max PriceUS$44.97
SellUS$293,54907 Mar 19
Randall Theisen
EntityIndividual
Role
Chief Legal Officer
General Counsel & Secretary
Shares6,358
Max PriceUS$46.17
SellUS$174,56322 Feb 19
Bruce Beach
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares3,750
Max PriceUS$46.55
SellUS$109,23330 Jan 19
Randall Theisen
EntityIndividual
Role
Chief Legal Officer
General Counsel & Secretary
Shares2,370
Max PriceUS$46.09
SellUS$92,00030 Jan 19
Robert McAuslan
EntityIndividual
Role
Senior Key Executive
Executive Vice President
Shares2,000
Max PriceUS$46.00

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Dale Gibbons (59yo)

    Vice Chairman & CFO

    • Tenure: 16.6yrs
    • Compensation: US$2.35m
  • Robert Sarver (58yo)

    Executive Chairman of the Board

    • Tenure: 17yrs
    • Compensation: US$4.57m
  • Ken Vecchione (65yo)

    CEO, President & Director

    • Tenure: 0.08yrs
    • Compensation: US$4.83m
  • Dan Myers (59yo)

    Executive Vice President of Northern California Administration

    • Tenure: 4.4yrs
    • Compensation: US$1.66m
  • Bob McAuslan (71yo)

    Executive Vice President

    • Tenure: 8.7yrs
    • Compensation: US$1.27m
  • James Ardrey (51yo)

    Senior VP & Chief Accounting Officer

    • Tenure: 8.3yrs
  • Barbara Kennedy (52yo)

    Chief Human Resource Officer

    • Tenure: 1.7yrs
    • Compensation: US$1.63m
  • Randall Theisen (61yo)

    General Counsel & Secretary

    • Tenure: 13.8yrs
  • Jeff Semonovich

    Chief Information Officer

    • Tenure: 0yrs
  • Robyn Young

    Executive VP & Chief Marketing Officer

    • Tenure: 0yrs

Board Members

  • Steve Hilton (58yo)

    Director

    • Tenure: 17yrs
    • Compensation: US$282.29k
  • Donald Snyder (72yo)

    Independent Director

    • Tenure: 22.9yrs
    • Compensation: US$292.29k
  • Marianne Johnson (61yo)

    Independent Director

    • Tenure: 24.2yrs
    • Compensation: US$282.29k
  • Robert Sarver (58yo)

    Executive Chairman of the Board

    • Tenure: 17yrs
    • Compensation: US$4.57m
  • James Nave (75yo)

    Independent Director

    • Tenure: 24.2yrs
    • Compensation: US$292.29k
  • Ken Vecchione (65yo)

    CEO, President & Director

    • Tenure: 0.08yrs
    • Compensation: US$4.83m
  • Bruce Beach (70yo)

    Lead Independent Director

    • Tenure: 9.9yrs
    • Compensation: US$307.29k
  • Sung Sohn (75yo)

    Independent Director

    • Tenure: 9.2yrs
    • Compensation: US$302.29k
  • Howard Gould (69yo)

    Independent Director

    • Tenure: 4.2yrs
    • Compensation: US$292.29k
  • Michael Patriarca (68yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: US$357.29k

Company Information

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


Key Information


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 compa ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/14 00:15
End of Day Share Price2019/12/13 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.