1 / 12

Regions Financial Corp RF

Regions Financial Corp RF. October 15, 2009 Chris Martin. Summary of Business.

blue
Download Presentation

Regions Financial Corp RF

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Regions Financial Corp RF October 15, 2009 Chris Martin

  2. Summary of Business • Regions Bancorp is based in Birmingham, Ala. The bank, which has $142 billion in assets, operates retail and commercial banking businesses and owns investment brokerage house Morgan Keegan, which made up 19% of the firm's 2008 revenue. With about 2,000 offices, Regions operates in 16 states and is among the largest banks in the United States by assets. • Regional bank in the Southeast.

  3. Recent News • 10/14 Close: 6.09 up 2.18% • Analysts expect RF to post a third-quarter loss of 25 cents per share. (Yahoo 10/13) • RF hit with class action lawsuit regarding purchase of AmSouth in 2006 (Morningstar 10/09)

  4. Competitive Standing • Market Cap: 7.2 Billion • Largest southeast regional bank by market cap. • Significantly undervalued compared to competitors. From Yahoo Finance

  5. Key Statistics RFInd. Avg. P/B: .5 .8 P/S: .6 1.2 Rev Growth (3 yr): 14.3 7.8 ROE (ttm): -36.6 -21.7 ROA (ttm): -4.34 From Yahoo Finance and Morningstar

  6. Key Statistics • Cash/Sh: 8.02 • Book value/sh: 12.74 • Debt Equity: 1.2 • Dividend Yield: .04 (.7%) • Total Cash: 9.54 Billion • Total Debt: 25.43 Billion • Beta: .93 From Yahoo Finance and Morningstar

  7. Intrinsic Value • Morningstar FV Estimate = $10.00 • DDM = $11.76 *Used 2Q09 EPS and Zacks next year estimate of earnings growth

  8. 1 Yr. Compared to S&P & Suntrust

  9. Analyst Opinions • Morningstar considers this a mid/value • 4 stars and a 2.9 mean reccomendation • Yahoo analysts: Strong buy-3, Hold-14, Underperform-2

  10. Analyst Opinions • With a large residential construction portfolio and a sizable Florida exposure, Regions Financial has struggled since the busted housing bubble burst. But while the short-run looks rough for the bank, long-run profits could again emerge after the newly beefed-up capital base absorbs the short-term losses. With Regions' numerous capital raises, we believe the firm's equity/asset ratio will exceed 13% until the company repays the government's original Troubled Asset Relief Program money sometime in 2011. The additional capital allows Regions to absorb the $2 billion of annual loan losses we expect in 2009 and 2010 without jeopardizing its status with the regulators.

  11. SWOT Analysis • Strengths: RF is in 16 states, and each region has its own management. Strong mgt team led by Dowd Ritter, CEO from Amsouth, well capitalized • Weaknesses: Expected EPS of -25 cents per share, weak earnings due to commercial real estate and construction lending to continue through 2010 • Opportunities: Acquisitions, 25% annual asset growth last five years, • Threats: 9% of loan book is in construction, falling FL home prices.

  12. Overview • https://www.regions.com/about_regions/IR_investorrelations.html

More Related