Pnc Financial Services Group, Inc. (NYSE: PNC)

Sector: Financial Services Industry: Banks - Regional CIK: 0000713676
Market Cap 84.36 Bn
P/B 1.43
P/E 13.61
P/S 3.73
ROIC (Qtr) 5.89
Div Yield % 3.13
Rev 1y % (Qtr) 8.89
Total Debt (Qtr) 62.34 Bn
Debt/Equity (Qtr) 1.06

About

The PNC Financial Services Group, Inc. (PNC), headquartered in Pittsburgh, Pennsylvania, is a leading diversified financial services company with a rich history dating back to 1983. The company operates under the ticker symbol PNC and has a significant presence in the United States, providing a range of financial services that include retail banking, corporate and institutional banking, and asset management. PNC's main business activities involve generating revenue through deposit, credit, and fee-based products. The company offers a diverse range...

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Price action

Investment thesis

Bull case

  • Strong tangible asset base of 557.80B provides 8.95x coverage of total debt 62.34B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 5.43B provides exceptional 83.49x coverage of minority interest expenses 65M, showing strong core operations.
  • Cash position of 38.87B provides exceptional 598.02x coverage of minority interest expenses 65M, indicating strong liquidity.
  • Retained earnings of 62.01B represent substantial 1.05x of equity 58.99B, indicating strong internal capital generation.
  • Retained earnings of 62.01B provide strong 5.66x coverage of intangibles 10.96B, indicating quality earnings retention.

Bear case

  • Operating cash flow of 5.43B barely covers its investment activities of (6.37B), with a coverage ratio of -0.85, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 5.43B provides thin coverage of dividend payments of (2.60B) with a -2.08 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Free cash flow of 5.43B represents just -0.97x of debt issuance (5.57B), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Retained earnings of 62.01B provide limited buffer against comprehensive income items of (4.08B), which is -15.21x, indicating elevated exposure to market risks.
  • Operating cash flow of 5.43B is outpaced by equity issuance of (1.08B) (-5.01 ratio), indicating concerning reliance on equity markets for funding operations.

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 0.20 0.14
EV to Cash from Ops. EV/CFO 21.08 7.21
EV to Debt EV to Debt 1.83 5.20
EV to EBIT EV/EBIT 14.30 14.98
EV to EBITDA EV/EBITDA 12.31 8.92
EV to Free Cash Flow [EV/FCF] EV/FCF 21.08 8.87
EV to Market Cap EV to Market Cap 1.36 1.04
EV to Revenue EV/Rev 5.06 -3.76
Price to Book Value [P/B] P/B 1.43 1.17
Price to Earnings [P/E] P/E 13.61 15.63
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 2.12 271.44
Dividend Payout Ratio % Div Payout % (Qtr) 41.90 35.28
Dividend per Basic Share Div per Share (Qtr) 4.90 0.89
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 35.75 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) -5.62 15.78
Dividend Growth (1y) % Div 1y % (Qtr) -22.22 5.32
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 26.89 110.93
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 25.69 38.80
EBIT Growth (1y) % EBIT 1y % (Qtr) 26.41 61.46
EBT Growth (1y) % EBT 1y % (Qtr) 26.41 61.37
EPS Growth (1y) % EPS 1y % (Qtr) 31.00 76.34
FCF Growth (1y) % FCF 1y % (Qtr) -50.41 161.72
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 5.84 14.15
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.04 0.04
Cash Payout Ratio Cash Payout (Qtr) 0.51 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) 1.06 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 % (Qtr) 37.30 147.97
EBIT Margin % EBIT Margin % (Qtr) 35.39 155.41
EBT Margin % EBT Margin % (Qtr) 35.39 154.66
Gross Margin % Gross Margin % (Qtr) 100.00 97.82
Net Profit Margin % Net Margin % (Qtr) 27.40 115.63