Us Bancorp \De\ (NYSE: USB)

Sector: Financial Services Industry: Banks - Regional CIK: 0000036104
Market Cap 84.44 Bn
P/B 1.33
P/E 12.40
P/S 3.25
ROIC (Qtr) 5.11
Div Yield % 3.72
Rev 1y % (Qtr) 7.22
Total Debt (Qtr) 77.98 Bn
Debt/Equity (Qtr) 1.23

About

US Bancorp (USB) is a financial services holding company based in Minneapolis, Minnesota. With a rich history in the industry, the company offers a comprehensive range of financial services, including lending and depository services, cash management, capital markets, and trust and investment management services. USB operates through five business segments: Wealth, Corporate, Commercial and Institutional Banking, Consumer and Business Banking, Payment Services, and Treasury and Corporate Support. The company's operations span across various business...

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Price action

Investment thesis

Bull case

  • Strong tangible asset base of 677.57B provides 8.69x coverage of total debt 77.98B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 9.90B provides exceptional 366.67x coverage of minority interest expenses 27M, showing strong core operations.
  • Cash position of 66.64B provides exceptional 2468.04x coverage of minority interest expenses 27M, indicating strong liquidity.
  • Operating cash flow of 9.90B provides strong 4.96x coverage of operating expenses 1.99B, showing operational efficiency.
  • Retained earnings of 79.74B represent substantial 1.26x of equity 63.34B, indicating strong internal capital generation.

Bear case

  • Operating cash flow of 9.90B barely covers its investment activities of (16.56B), with a coverage ratio of -0.60, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 9.90B provides thin coverage of dividend payments of (3.14B) with a -3.15 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 66.64B provide limited coverage of acquisition spending of (35M), which is -1903.91x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 9.90B represents just -7.86x of debt issuance (1.26B), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Retained earnings of 79.74B provide limited buffer against comprehensive income items of (7.75B), which is -10.29x, indicating elevated exposure to market 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 0.15 0.14
EV to Cash from Ops. EV/CFO 10.68 7.21
EV to Debt EV to Debt 1.36 5.20
EV to EBIT EV/EBIT 11.66 14.98
EV to EBITDA EV/EBITDA 10.59 8.92
EV to Free Cash Flow [EV/FCF] EV/FCF 10.68 8.87
EV to Market Cap EV to Market Cap 1.25 1.04
EV to Revenue EV/Rev 4.06 -3.76
Price to Book Value [P/B] P/B 1.33 1.17
Price to Earnings [P/E] P/E 12.40 15.63
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.94 271.44
Dividend Payout Ratio % Div Payout % (Qtr) 46.10 35.28
Dividend per Basic Share Div per Share (Qtr) 2.02 0.89
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 31.77 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) -9.41 15.78
Dividend Growth (1y) % Div 1y % (Qtr) 2.54 5.32
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 31.10 110.93
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 28.72 38.80
EBIT Growth (1y) % EBIT 1y % (Qtr) 34.02 61.46
EBT Growth (1y) % EBT 1y % (Qtr) 34.02 61.37
EPS Growth (1y) % EPS 1y % (Qtr) 34.36 76.34
FCF Growth (1y) % FCF 1y % (Qtr) 43.00 161.72
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 4.48 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) 0.33 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) 1.23 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) 38.30 147.97
EBIT Margin % EBIT Margin % (Qtr) 34.85 155.41
EBT Margin % EBT Margin % (Qtr) 34.85 154.66
Gross Margin % Gross Margin % (Qtr) 100.00 97.82
Net Profit Margin % Net Margin % (Qtr) 26.20 115.63