NatWest Group plc (NYSE: NWG)

Sector: Financial Services Industry: Banks - Regional CIK: 0000844150
Market Cap 66.53 Bn
P/B 1.16
P/E 9.88
P/S 3.05
ROIC (Qtr) 2.36
Div Yield % 3.64
Rev 1y % (Qtr) 18.83
Total Debt (Qtr) 169.04 Bn
Debt/Equity (Qtr) 2.95

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...

Read more

Price action

Investment thesis

Bull case

  • Strong tangible asset base of 970.48B provides 5.74x coverage of total debt 169.04B, indicating robust asset backing and low credit risk.
  • Cash position of 114.44B provides exceptional 84686x coverage of minority interest expenses 1.35M, indicating strong liquidity.
  • Strong tangible asset base of 970.48B provides 96.05x coverage of intangibles 10.10B, indicating robust asset quality.

Bear case

  • Operating cash flow of 0 provides minimal 0x coverage of tax expenses of 2.22B, suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Operating cash flow of 0 barely covers operating expenses of 812.16M with a 0 ratio, suggesting thin operational efficiency margins and limited flexibility.
  • R&D investment of 0 represents just 0x of SG&A expenses of 11.19B, indicating potential underinvestment in innovation relative to administrative overhead.
  • Deposit liabilities of 649.26B significantly exceed cash reserves of 114.44B, which is 5.67x, indicating potential liquidity risk in stress scenarios.
  • Operating cash flow of 0 shows concerning coverage of minority interest expenses of 1.35M, which is 0x, suggesting complex corporate structure risks.

Peer comparison

Companies in the Banks - Regional
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 USB Us Bancorp \De\ 84.44 Bn 12.40 3.25 77.98 Bn
2 PNC Pnc Financial Services Group, Inc. 84.36 Bn 13.61 3.73 62.34 Bn
3 NU Nu Holdings Ltd. 81.47 Bn 32.21 5.79 4.49 Bn
4 NWG NatWest Group plc 66.53 Bn 9.88 3.05 169.04 Bn
5 TFC Truist Financial Corp 64.60 Bn 13.18 3.53 71.11 Bn
6 MTB M&T Bank Corp 32.73 Bn 12.47 3.60 14.99 Bn
7 FITB Fifth Third Bancorp 31.96 Bn 14.15 3.93 18.94 Bn
8 FCNCA First Citizens Bancshares Inc /De/ 28.98 Bn 12.78 3.26 40.00 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.17 0.14
EV to Cash from Ops. EV/CFO -17.13 7.21
EV to Debt EV to Debt 1.00 5.20
EV to EBIT EV/EBIT 17.87 14.98
EV to EBITDA EV/EBITDA 21.76 8.92
EV to Free Cash Flow [EV/FCF] EV/FCF -16.51 8.87
EV to Market Cap EV to Market Cap 2.53 1.04
EV to Revenue EV/Rev 7.73 -3.76
Price to Book Value [P/B] P/B 1.16 1.17
Price to Earnings [P/E] P/E 9.88 15.63
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 271.44
Dividend Payout Ratio % Div Payout % (Qtr) 36.20 35.28
Dividend per Basic Share Div per Share (Qtr) 0.65 0.89
FCF Dividend Payout Ratio % FCF Dividend Payout Ratio % 0.00 34.52
Interest Coverage Interest Coverage 0.00 -0.05
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 0.00 -73.15
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -17.66 15.78
Dividend Growth (1y) % Div 1y % (Qtr) 10.63 5.32
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 21.74 110.93
EBITDA Growth (1y) % EBITDA Growth (1y) % 0.00 38.80
EBIT Growth (1y) % EBIT 1y % (Qtr) 25.15 61.46
EBT Growth (1y) % EBT 1y % (Qtr) 25.15 61.37
EPS Growth (1y) % EPS 1y % (Qtr) 29.91 76.34
FCF Growth (1y) % FCF Growth (1y) % 0.00 161.72
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 15.01 14.15
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 0.26
Cash Ratio Cash Ratio 0.00 0.00
Current Ratio Current Ratio 0.00 0.01
Debt to Equity Ratio Debt/Equity (Qtr) 2.95 0.53
Interest Cover Ratio Interest Cover Ratio 0.00 -0.05
Times Interest Earned Times Interest Earned 0.00 -0.05
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % 0.00 147.97
EBIT Margin % EBIT Margin % (Qtr) 31.99 155.41
EBT Margin % EBT Margin % (Qtr) 43.24 154.66
Gross Margin % Gross Margin % (Qtr) 100.00 97.82
Net Profit Margin % Net Margin % (Qtr) 30.90 115.63