CFFN Capitol Federal Financial Inc Stock Price & News

As a small commercial bank, Capitol Federal Financial provides all the primary services that many other banks of its size due. Examples here include offering deposit services, not only for the general the sum of all is gross working capital public, but also for businesses. The company gives out loans, including commercial loans, mortgages, and more. It also makes investments in various securities, including mortgage-backed securities.

About $2.58 billion of this amount was in the form of loans that the bank purchased, with about $3.99 billion involving loans that it originated. The second-largest concentration of loans involved commercial properties, at about $1.22 billion. All things considered, I must say that I am fairly pleased with Capitol Federal Financial. It’s a bit more complicated to digest its fundamental picture because it deviates in multiple ways, some positive, and some negative, from many of the other banks that I have looked at. Uninsured deposit exposure is lower, but overall deposits have really failed to grow. Debt is high while the book value per share has continued to drop.

Capitol Federal Financial Inc.

We focus on cash flow and the companies that generate it, leading to value and growth prospects with real potential. Over the past few fiscal years, Capitol Federal Financial https://1investing.in/ has done quite well to grow both its top and bottom lines. Net interest income, for instance, managed to rise from $167 million in 2020 to $197.2 million in 2022.

A lot of this pain recently has come from higher interest expense that the company has had to cover. For the first nine months of 2023, for instance, interest paid on deposits totaled $52.5 million. This was more than double the $25.4 million reported one year earlier. But the real pain came from a surge in the interest expense paid on borrowings.

Risk Analysis

Other than the high amount of leverage and the recent drop in deposits, the only negative that I see with Capitol Federal Financial is that its book value per share has a history of declining from year to year. Even though this is a negative, it is worth mentioning that shares are currently trading at only 67.4% of the company’s book value. And, using results from 2022, the stock is trading at a price-to-earnings multiple of 8.7. This is quite attractive, though not the cheapest that I have seen by any means.

This jumped from $28 million last year to $96.5 million this year. At the end of 2022, for instance, the bank had $2.13 billion of debt on its books. As of the end of the third quarter, this number had grown to $2.99 billion. On top of this, a general increase in interest rates caused by Federal Reserve policy aimed at combating inflation has also proven to be problematic for the bank. We saw a slight drop to $6.07 billion in the first quarter of this year before experiencing a slight rebound to $6.14 billion during the second quarter.

Services

CFFN’s beta can be found in Trading Information at the top of this page. A stock’s beta measures how closely tied its price movements have been to the performance of the overall market. A roundup of the latest corporate earnings reports and what companies are saying about future quarters.

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Third quarter 2021 earnings released: EPS US$0.13 (vs US$0.14 in 3Q

High-growth stocks tend to represent the technology, healthcare, and communications sectors. They rarely distribute dividends to shareholders, opting for reinvestment in their businesses. More value-oriented stocks tend to represent financial services, utilities, and energy stocks. The growth that the institution saw between 2020 and 2022 was made possible by continued investments made in the form of loans and various securities. Available for sale securities remained more or less flat at around $1.56 billion during that three-year window, though there was a spike to $2.01 billion in 2021. Meanwhile, the value of loans increased from $7.20 billion to $7.46 billion.

• Available for sale securities remained more or less flat at around $1.56 billion during that three-year window, though there was a spike to $2.01 billion in 2021.
• Capitol Federal Financial, Inc. operates as the holding company for Capitol Federal Savings Bank that provides various retail banking products and services in the United States.
• Both of these, combined, caused net income to grow from $64.5 million to $84.5 million.
• Capitol Federal Financial announced a quarterly dividend on Tuesday, July 25th.
• At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors.

Prior to this year, the bank had done quite well in terms of growing its top and bottom lines. But we have seen some weakness this year because of higher interest rates. But on the whole, I feel as though the bank is attractive enough to rate a soft ‘buy’ at this time. Driven by high amounts of debt, declining profits, and continued weakness when it comes to deposits, Capitol Federal Financial is still down 36% compared to where the stock ended in February of this year. For context, at its low point after February, shares were down as much as 37.4%.

Capitol Federal Financial, Inc.® Reports Second Quarter Fiscal Year 2022 Results

Normally, the continued decline in deposits would cause me to be concerned. He runs Crude Value Insights, a value-oriented newsletter aimed at analyzing the cash flows and assessing the value of companies in the oil and gas space. Capitol Federal Financial announced a quarterly dividend on Tuesday, July 25th. Shareholders of record on Friday, August 4th will be paid a dividend of $0.085 per share on Friday, August 18th. This represents a $0.34 annualized dividend and a dividend yield of 6.48%.

• Uninsured deposit exposure is lower, but overall deposits have really failed to grow.
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Over this window of time, non-interest income inched up from $19.6 million to $22.8 million. Both of these, combined, caused net income to grow from $64.5 million to $84.5 million. This is not to say that everything has gone fantastic from a revenue and profit perspective. In the first three quarters of 2023, net interest income for the bank came in at $116.7 million. As the chart above illustrates, both non-interest income and net profits also declined on a year-over-year basis, with the latter dropping by almost half from $65 million to $38.7 million. These three financial-sector stocks are all sharply higher, despite the overall pressure on the stock market.

According to one analyst, the rating for CFFN stock is “Hold” and the 12-month stock price forecast is $7.5. © 2023 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided ‘as-is’ and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart’s disclaimer. Crude Value Insights offers you an investing service and community focused on oil and natural gas.

However, in the third quarter, which was the first full quarter for which the effects of the banking crisis played out, deposits fell again, totaling $6.09 billion. Though that is not a large drop, it is still discouraging to see during these uncertain times. The really good thing about the deposit picture, however, is that, as of the end of the most recent quarter, only 11.1% of deposits were classified as uninsured. This is some of the lowest exposure that I have seen in a bank this year. That certainly makes the picture better from a risk perspective.