Preferred Bank
Preferred Bank Fundamental Analysis
Preferred Bank (PFBC) shows moderate financial fundamentals with a PE ratio of 8.82, profit margin of 26.59%, and ROE of 17.29%. The company generates $0.5B in annual revenue with weak year-over-year growth of -4.11%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 68.3/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze PFBC's fundamental strength across five key dimensions:
Efficiency Score
WeakPFBC struggles to generate sufficient returns from assets.
Valuation Score
ExcellentPFBC trades at attractive valuation levels.
Growth Score
WeakPFBC faces weak or negative growth trends.
Financial Health Score
ExcellentPFBC maintains a strong and stable balance sheet.
Profitability Score
ExcellentPFBC achieves industry-leading margins.
Key Financial Metrics
Is PFBC Expensive or Cheap?
P/E Ratio
PFBC trades at 8.82 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, PFBC's PEG of 1.59 indicates fair valuation.
Price to Book
The market values Preferred Bank at 1.49 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 8.38 times EBITDA. This is generally considered low.
How Well Does PFBC Make Money?
Net Profit Margin
For every $100 in sales, Preferred Bank keeps $26.59 as profit after all expenses.
Operating Margin
Core operations generate 37.72 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $17.29 in profit for every $100 of shareholder equity.
ROA
Preferred Bank generates $1.76 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Preferred Bank generates strong operating cash flow of $167.72M, reflecting robust business health.
Free Cash Flow
Preferred Bank generates strong free cash flow of $166.38M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $13.66 in free cash annually.
FCF Yield
PFBC converts 14.22% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
8.82
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.59
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.49
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.34
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.49
vs 25 benchmark
Current Ratio
Current assets to current liabilities
149.60
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.17
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.02
vs 25 benchmark
How PFBC Stacks Against Its Sector Peers
| Metric | PFBC Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 8.82 | 19.21 | Better (Cheaper) |
| ROE | 17.29% | 817.00% | Weak |
| Net Margin | 26.59% | -464.00% (disorted) | Strong |
| Debt/Equity | 0.49 | 12.73 | Strong (Low Leverage) |
| Current Ratio | 149.60 | 659.50 | Strong Liquidity |
| ROA | 1.76% | -24814.00% (disorted) | Weak |
PFBC 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 Preferred Bank's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
167.70%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
127.35%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
91.51%
Industry Style: Value, Dividend, Cyclical
High Growth