The Bank of N.T. Butterfield & Son Limited Fundamental Analysis (NYSE: NTB)
The Bank of N.T. Butterfield & Son Limited Fundamental Analysis (NYSE: NTB)
The Bank of N.T. Butterfield & Son Limited (NYSE: NTB) shows strong financial fundamentals with a PE ratio of 9.92, profit margin of 32.58%, and ROE of 20.68%. The company generates $0.7B in annual revenue with weak year-over-year growth of -2.04%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 70.6/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze NTB's fundamental strength across five key dimensions:
Efficiency Score
WeakNTB struggles to generate sufficient returns from assets.
Valuation Score
ExcellentNTB trades at attractive valuation levels.
Growth Score
ModerateNTB shows steady but slowing expansion.
Financial Health Score
ExcellentNTB maintains a strong and stable balance sheet.
Profitability Score
ExcellentNTB achieves industry-leading margins.
Key Financial Metrics
Is NTB Expensive or Cheap?
P/E Ratio
NTB trades at 9.92 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, NTB's PEG of 0.71 indicates potential undervaluation.
Price to Book
The market values The Bank of N.T. Butterfield & Son Limited at 1.97 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 13.20 times EBITDA. This signals the market has high growth expectations.
How Well Does NTB Make Money?
Net Profit Margin
For every $100 in sales, The Bank of N.T. Butterfield & Son Limited keeps $32.58 as profit after all expenses.
Operating Margin
Core operations generate 33.50 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $20.68 in profit for every $100 of shareholder equity.
ROA
The Bank of N.T. Butterfield & Son Limited generates $1.63 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The Bank of N.T. Butterfield & Son Limited generates strong operating cash flow of $235.22M, reflecting robust business health.
Free Cash Flow
The Bank of N.T. Butterfield & Son Limited generates strong free cash flow of $211.30M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.33 in free cash annually.
FCF Yield
NTB converts 9.24% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
9.92
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.71
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.97
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.17
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.03
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1518.86
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.21
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.02
vs 25 benchmark
How NTB Stacks Against Its Sector Peers
| Metric | NTB Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 9.92 | 20.38 | Better (Cheaper) |
| ROE | 20.68% | 633.00% | Weak |
| Net Margin | 32.58% | -532.00% (disorted) | Strong |
| Debt/Equity | 0.03 | 0.89 | Strong (Low Leverage) |
| Current Ratio | 1518.86 | 823.98 | Strong Liquidity |
| ROA | 1.63% | 72.00% | Weak |
NTB outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The Bank of N.T. Butterfield & Son Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
93.26%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
91.09%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
80.25%
Industry Style: Value, Dividend, Cyclical
High Growth