NatWest Group plc (NYSE: NWG)

Sector: Financial Services Industry: Banks - Regional CIK: 0000844150
Market Cap 63.11 Bn
P/B 1.10
P/E 9.11
P/S 2.81
ROIC (Qtr) 2.56
Div Yield % 3.82
Rev 1y % (Qtr) 22.21
Total Debt (Qtr) 168.56 Bn
Debt/Equity (Qtr) 2.93
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About

NatWest Group plc, or NatWest as it is commonly known, is a prominent financial services provider based in the United Kingdom. The company operates under the ticker symbol NWG and maintains a significant presence in the financial industry. Its operations span various countries, primarily in the United Kingdom and Ireland, with a focus on serving individual customers, small and medium-sized enterprises (SMEs), and large corporations. The primary sources of NatWest's revenue are retail and commercial banking. Retail banking is a core segment for...

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Investment thesis

Bull case

  • Strong tangible asset base of 955.76B provides 5.67x coverage of total debt 168.56B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 9.56B provides exceptional 2357.33x coverage of minority interest expenses 4.05M, showing strong core operations.
  • Cash position of 115.11B provides exceptional 28394x coverage of minority interest expenses 4.05M, indicating strong liquidity.
  • Operating cash flow of 9.56B provides strong 10.54x coverage of operating expenses 906.76M, showing operational efficiency.
  • Strong free cash flow of 9.56B provides 0.86x coverage of SG&A expenses 11.16B, indicating efficient cost management.

Bear case

  • Operating cash flow of 9.56B barely covers its investment activities of (18.60B), with a coverage ratio of -0.51, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • R&D investment of 0 represents just 0x of SG&A expenses of 11.16B, indicating potential underinvestment in innovation relative to administrative overhead.
  • Deposit liabilities of 658.23B significantly exceed cash reserves of 115.11B, which is 5.72x, indicating potential liquidity risk in stress scenarios.

Segments [axis] Breakdown of Revenue (2025)

Segments [axis] Breakdown of Revenue (2025)

Peer comparison

Companies in the Banks - Regional
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PNC Pnc Financial Services Group, Inc. 99.49 Bn 13.81 5.85 62.34 Bn
2 USB Us Bancorp \De\ 87.84 Bn 19.01 4.52 77.98 Bn
3 NU Nu Holdings Ltd. 81.18 Bn 32.10 5.77 4.49 Bn
4 NWG NatWest Group plc 63.11 Bn 9.11 2.81 168.56 Bn
5 RF Regions Financial Corp 39.59 Bn 38.18 7.68 6.09 Bn
6 TFC Truist Financial Corp 39.02 Bn 20.15 4.25 71.11 Bn
7 FITB Fifth Third Bancorp 34.49 Bn -132.65 9.50 18.94 Bn
8 MTB M&T Bank Corp 33.34 Bn 20.67 5.83 14.99 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.17 0.13
EV to Cash from Ops. EV/CFO 16.80 13.53
EV to Debt EV to Debt 0.95 7.69
EV to EBIT EV/EBIT 16.16 24.25
EV to EBITDA EV/EBITDA 20.74 12.10
EV to Free Cash Flow [EV/FCF] EV/FCF 16.80 6.13
EV to Market Cap EV to Market Cap 2.54 1.08
EV to Revenue EV/Rev 7.14 6.13
Price to Book Value [P/B] P/B 1.10 1.91
Price to Earnings [P/E] P/E 9.11 10.51
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 276.83
Dividend Payout Ratio % Div Payout % (Qtr) 35.10 34.36
Dividend per Basic Share Div per Share (Qtr) 0.65 0.89
FCF Dividend Payout Ratio % FCF Dividend Payout Ratio % 36.63 24.01
Interest Coverage Interest Coverage 0.00 -0.06
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 0.00 -73.37
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -0.97 18.43
Dividend Growth (1y) % Div 1y % (Qtr) 45.27 5.56
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 31.07 117.24
EBITDA Growth (1y) % EBITDA Growth (1y) % 0.00 36.31
EBIT Growth (1y) % EBIT 1y % (Qtr) 32.84 61.65
EBT Growth (1y) % EBT 1y % (Qtr) 32.84 61.55
EPS Growth (1y) % EPS 1y % (Qtr) 37.41 65.85
FCF Growth (1y) % FCF Growth (1y) % 331.46 186.92
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 22.36 12.98
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.03 0.04
Cash Payout Ratio Cash Payout Ratio 0.00 0.25
Cash Ratio Cash Ratio 0.00 0.00
Current Ratio Current Ratio 0.00 0.01
Debt to Equity Ratio Debt/Equity (Qtr) 2.93 0.52
Interest Cover Ratio Interest Cover Ratio 0.00 -0.06
Times Interest Earned Times Interest Earned 0.00 -0.06
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % 0.00 150.40
EBIT Margin % EBIT Margin % (Qtr) 32.70 157.97
EBT Margin % EBT Margin % (Qtr) 44.19 157.21
Gross Margin % Gross Margin % (Qtr) 100.00 97.97
Net Profit Margin % Net Margin % (Qtr) 30.80 117.48