Community Bank System (CBU) Q4 2019 Earnings Prep

in EARNINGS/INVESTING IDEAS by

Community Bank System, Inc. (NYSE:CBU) is scheduled to report Q4 earnings results before the NYSE opens on Wednesday, January 22, 2020. The conference call details can be found in this press release.

The company is expected to report earnings of $0.82/share on revenue of $150.5 million. The consensus earnings per share (EPS) of $0.82/share is based on a poll of 6 analysts and represents a growth of 5.2% over the same quarter last year when the company reported earnings of $0.78/share.

The revenue forecast of $150.5 million based on a poll of 3 analysts implies a year-over-year (YoY) growth of 6.3%. Last year the company reported $141.6 million in revenue for the quarter.

Expected to report EPS growth of $0.04/share for Q4, 2019
Metric Expected Prior Year YoY Change
Revenue $150.48 $141.60 6.3%
EPS $0.82 $0.78 5.2%

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, missed 2 quarters, and met expectations 1 quarter.

What are your expectations from the Community Bank System for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q3, 2019 $0.81 $0.84 3.7% Beat
Q2, 2019 $0.80 $0.80 0.0% Meet
Q1, 2019 $0.76 $0.81 6.6% Beat
Q4, 2018 $0.80 $0.78 -2.0% Missed
Q3, 2018 $0.78 $0.82 5.3% Beat
Q2, 2018 $0.81 $0.86 6.2% Beat
Q1, 2018 $0.73 $0.78 6.8% Beat
Q4, 2017 $0.69 $0.66 -3.6% Missed

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report.

After the last earnings report for the period ending September 30, 2019, the stock price reacted by increasing by 4.3%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
2019-10-21 $63.86 $66.61 4.3% Increase
2019-07-22 $64.42 $64.79 0.6% Increase
2019-04-22 $62.38 $64.85 4.0% Increase
2019-01-23 $63.29 $60.13 -5.0% Decline

Fundamentals And Technical Analysis

Community Bank System is currently trading at $70.90/share, down -0.6% for the day. The company is trading at approximately 97.6% of its 52-week high of $72.63/share. The company’s stock price is up 6.4% since the last earnings report and down -0.6% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 60.55 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.

NYSE:CBU Stock Price Chart Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 22.1x and a forward P/E multiple of 21.7x.

Community Bank System’s current share price also implies a price-to-book (P/B) multiple of 2.0x. The following table summarizes some other key fundamental ratios:

Data as of January 21, 2020
Metric Value
Last Fiscal Period FY2019.Q3
Period End Date September 30, 2019
Stock Price (Current) $70.90
P/E Ratio 22.1x
P/E Ratio (Fwd) 21.7x
PEG Ratio 7.3
Total Debt to Capital (%) 9.2%
Levered Free Cash Flow $173.8 million
Market Capitalization $3.687 billion

Source: Finbox

Company Profile: Community Bank System, Inc.

Community Bank System, Inc. is a mid-cap stock with a market capitalization of $3.687 billion. The company operates in the Financial sector and the Banks industry.

Community Bank System, Inc. operates as the bank holding company for Community Bank, N.A. that provides various banking and other financial services to retail, commercial, and municipal customers. It operates through three segments: Banking, Employee Benefit Services, and All Other.

The company offers various deposits products, such as checking, savings, and money market accounts, as well as time deposits. It also provides loans comprising consumer mortgages; general purpose commercial and industrial loans, and mortgages on commercial properties; installment loans that are originated through selected dealerships and are secured by automobiles, marine, and other recreational vehicles; personal installment loans and lines of credit for consumers; and home equity products.

In addition, the company offers broker-dealer and investment advisory services; and asset management services to individuals, corporations, corporate pension, and profit-sharing plans, and foundations, as well as operates as a full-service insurance agency that offers personal and commercial property insurance, and other risk management products and services.

Further, it offers contribution plan administration services, actuarial and benefits consulting services, and collective investment fund administration and institutional trust services, as well as employee benefit trust, retirement plan administration, VEBA/HRA, and health and welfare consulting services.

Additionally, the company provides wealth management, higher educational planning, fiduciary, risk management, and personal financial planning services; and investment alternatives, including stocks, bonds, mutual funds, and advisory products, as well as transfer agency and master recordkeeping services.

As of December 31, 2018, it had 224 branches in Upstate New York, as well as Northeastern Pennsylvania, Vermont, and Western Massachusetts. Community Bank System, Inc. was founded in 1866 and is headquartered in DeWitt, New York.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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