Merchants Bancorp (MBIN) stock analysis

P/E above its 5-year median

Merchants Bancorp's P/E of 8.8 is above its own 5-year median of 6.4.

P/E below the industry

Merchants Bancorp's P/E of 8.8 is below the Commercial Banks median of 12.1.

P/S below the industry

Merchants Bancorp's price-to-sales of 3.20 is below the Commercial Banks median of 3.60.

P/B below the industry

Merchants Bancorp's price-to-book of 0.99 is below the Commercial Banks median of 1.29.

Trading below fair value

The share price of $53.56 is below our fair value estimate of $57.41.

Margin of safety under 20%

The price is 6.7% below fair value, less than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 15.3% a year over the last three fiscal years.

EPS growing under 10% a year

Diluted EPS grew -5.4% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 29.4% over the last twelve months, against a 5-year average of 3.9% a year.

Growing faster than the industry

Revenue grew 11.3% over the last twelve months; the Commercial Banks median is 11.3%.

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 13.6% over the last twelve months and averaged 16.7% over five years; we look for 15% on both.

Return on assets over 1%

Return on assets was 1.6%; for a bank or insurer, 1% or more is considered good.

Return on equity above the industry

Merchants Bancorp's return on equity of 13.6% is above the Commercial Banks median of 11.5%.

Earnings grew over 5 years

Net income grew 3.9% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 41.6% over the last twelve months, against a 5-year average of 46.2%.

Net margin above the industry

Merchants Bancorp's net margin of 41.6% is above the Commercial Banks median of 30.3%.

Well capitalized

Equity is 11.9% of total assets; 8% or more is a comfortable cushion.

Loans funded by deposits

Loans equal 81.0% of deposits, so lending is funded by customer deposits.

Thin loan-loss reserve

The allowance for credit losses is 0.7% of loans; we look for at least 1%.

Efficient operations

Non-interest expense takes 40.6% of revenue; under 60% is efficient for a bank.

Deposits growing

Deposits grew 7.9% over the past year.

Borrowings

Needs debt and equity figures.

Pays a dividend

Merchants Bancorp paid dividends worth 0.8% of the share price over the last twelve months.

Yield below Treasuries

The 0.8% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Merchants Bancorp yields 0.8%.

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 19.1% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.