Based on PE and PBV, Popular’s competitors have outperformed. The ETFs that invest in Popular have also outperformed Popular based on price movement, PE, and PBV.
Year-to-date, Popular’s price movement is a mixture of ups and downs. After its 3Q15 earnings report, Popular stock fell 3.6% and closed at $30.26 per share on October 23, 2015.
The price-to-book value ratios of Synovus, BB&T, SunTrust Banks, Regions Financial, and Capital Bank Financial are 1.43x, 1.19x, 0.93x, 0.77x, and 1.37x.
In this series, we’ll review the banking sector’s two primary indicators—loan and deposit growth. Total loans are generally made up of commercial and industrial loans, consumer loans, and real estate loans.
The yield curve has steepened a bit compared to where it was a week or even a month ago. Investors should consider the yield curve slope an indicator of bank performance.
When interest rates rise, banks typically increase the interest they charge for loans faster than what they pay on deposits. This gives an immediate boost to their margins.
Banks benefit from a steeper yield curve, which allows banks to lend on higher long-term rates and borrow on lower short-term rates. This boosts banks’ margins.
Lower interest rates on a sustained basis have negatively impacted the performance of the US banking sector. Banks are not able to use much deposit pricing strategies to boost margins.
According to the Fed’s data, total loans for all US commercial banks increased 7.9% in the week ending May 6. Loan growth is vital to banks’ income growth.
PNC Financial (PNC) successfully diversified its banking operations by extending offerings in asset management, consumer services, and investment banking.
Dividend yield is a company’s annual dividend per share. It’s expressed as a percentage of its share price. Dividend yields are important if you want a regular stream of income.
BB&T’s Susquehanna acquisition will significantly expand BB&T’s Mid-Atlantic footprint. The deal is valued at ~$2.5 billion. It will close in the second half of 2015.
The revenue from insurance services isn’t sensitive to interest. It isn’t subject to the credit cycle’s dynamics. It provides stability to BB&T’s revenue.
BB&T’s (BBT) Specialized Lending consists of businesses and subsidiaries that provide specialty finance products. The segment’s net income decreased 5.9%.
Easing underwriting standards across auto lenders is leading to an increase in subprime lending. Dealer Financial Services grew average loans by 10.5% compared to 2013.
BB&T’s Community Banking segment offers a variety of loan and deposit products and other financial services. The segment’s net interest income decreased in 2014.
Regions Financial’s loan portfolio can broadly be classified into business and consumer loans. Business loans account for ~62% of the total loan portfolio.
For a bank, the net interest margin is the difference between the interest income generated and the interest paid out as a percentage of interest-earning assets.
The Three White Soldiers candlestick pattern is also a reversal pattern. It forms at the bottom of a downtrend. The pattern has three candles. All three of the candles are long and bullish.
