Fifth Third Bancorp (FITB.PI) stock analysis

P/E above its 5-year median

Fifth Third Bancorp's P/E of 18.4 is above its own 5-year median of 12.0.

P/E above the industry

Fifth Third Bancorp's P/E of 18.4 is above the Commercial Banks median of 12.3.

P/S above the industry

Fifth Third Bancorp's price-to-sales of 4.55 is above the Commercial Banks median of 3.64.

P/B above the industry

Fifth Third Bancorp's price-to-book of 1.42 is above the Commercial Banks median of 1.27.

Trading above fair value

The share price of $53.87 is above our fair value estimate of $42.62.

Margin of safety under 20%

The price is 26.4% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 148% a year over the last three fiscal years.

EPS growing under 10% a year

Diluted EPS grew 1.8% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 0.4% over the last twelve months, against a 5-year average of 12.1% a year.

Growing faster than the industry

Revenue grew 60.2% over the last twelve months; the Commercial Banks median is 11.4%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin trend

Banks and insurers do not report gross profit.

Return on equity under 15%

Return on equity was 8.4% over the last twelve months and averaged 12.3% over five years; we look for 15% on both.

Return on assets under 1%

Return on assets was 0.9%; for a bank or insurer, 1% or more is considered good.

Return on equity below the industry

Fifth Third Bancorp's return on equity of 8.4% is below the Commercial Banks median of 11.2%.

Earnings grew over 5 years

Net income grew 12.1% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 21.8% over the last twelve months, against a 5-year average of 268%.

Net margin below the industry

Fifth Third Bancorp's net margin of 21.8% is below the Commercial Banks median of 30.0%.

Well capitalized

Equity is 11.5% of total assets; 8% or more is a comfortable cushion.

Loans funded by deposits

Loans equal 75.0% of deposits, so lending is funded by customer deposits.

Adequate loan-loss reserve

The allowance for credit losses is 1.7% of loans; we look for at least 1%.

High cost base

Non-interest expense takes 65.9% of revenue; under 60% is efficient for a bank.

Deposits growing

Deposits grew 42.6% over the past year.

Modest borrowings

Borrowings other than deposits are 13.4% of equity.

Pays a dividend

Fifth Third Bancorp paid dividends worth 3.0% of the share price over the last twelve months.

Yield below Treasuries

The 3.0% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 4.0% or more; Fifth Third Bancorp yields 3.0%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 55.1% of net income.

Covered by free cash flow

Dividends take 42.8% of free cash flow.