Sterling Q4 Earnings: Can STL Hit Its $0.53 EPS Target?

in EARNINGS/INVESTING IDEAS by

Sterling Bancorp (NYSE:STL) is scheduled to report Q4 earnings results after the market close on Wednesday, January 22, 2020. The company’s CEO and President, Jack Kopnisky, will host a conference call and webcast on Thursday, January 23, 2020, at 10:30 AM Eastern Time to discuss the reported results.

The company is expected to report earnings of $0.53/share on revenue of $256.3 million. The consensus earnings per share (EPS) of $0.53/share is based on a poll of 10 analysts and represents a growth of 1.9% over the same quarter last year when the company reported earnings of $0.52/share.

The revenue forecast of $256.3 million based on a poll of 6 analysts implies a year-over-year (YoY) decline of -6.5%. Last year the company reported $274.2 million in revenue for the quarter.

Expected to report EPS growth of $0.01/share for Q4, 2019
Metric Expected Prior Year YoY Change
Revenue $256.31 $274.25 -6.5%
EPS $0.53 $0.52 1.9%

Earnings Call Trends

Historically, management has exceeded analyst expectations 3 out of the last 8 tracked quarters, missed 3 quarters, and met expectations 2 quarters.

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

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q3, 2019 $0.54 $0.52 -3.7% Missed
Q2, 2019 $0.52 $0.51 -1.9% Missed
Q1, 2019 $0.50 $0.50 0.0% Meet
Q4, 2018 $0.50 $0.52 4.0% Beat
Q3, 2018 $0.52 $0.51 -1.9% Missed
Q2, 2018 $0.48 $0.50 3.1% Beat
Q1, 2018 $0.45 $0.45 0.0% Meet
Q4, 2017 $0.38 $0.39 2.6% Beat

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.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
2019-10-23 $20.32 $19.74 -2.9% Decline
2019-07-24 $20.86 $21.37 2.4% Increase
2019-04-24 $20.41 $20.88 2.3% Increase
2019-01-23 $18.44 $18.88 2.4% Increase

After the last earnings report for the period ending September 30, 2019, the stock price reacted by falling by -2.9%.

Fundamentals And Technical Analysis

Sterling is currently trading at $20.68/share, down -1.0% for the day. The company is trading at approximately 93.3% of its 52-week high of $22.17/share. The company’s stock price is up 4.8% since the last earnings report and down -0.2% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 54.14 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.

The current share price implies a price-to-earnings (P/E) multiple of 9.7x and a forward P/E multiple of 10.0x. Sterling’s current share price also implies a price-to-book (P/B) multiple of 1.0x. 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) $20.68
P/E Ratio 9.7x
P/E Ratio (Fwd) 10.0x
PEG Ratio 7.2
Total Debt to Capital (%) 43.2%
Levered Free Cash Flow $423.6 million
Enterprise Value / EBITDA

Source: Finbox

Company Profile: Sterling Bancorp

Sterling Bancorp is a mid-cap stock with a market capitalization of $4.221 billion. The company operates in the Financial sector and the Banks industry.

Sterling Bancorp operates as the bank holding company for Sterling National Bank that provides various banking products and services to commercial, consumer, and municipal clients in the United States.

The company accepts deposit products, including checking, savings, money market, time, and interest and non-interest bearing demand deposits, as well as certificates of deposit and mortgage escrow funds.

It originates various loans that comprise residential and commercial mortgage loans; commercial and industrial, asset-based, payroll finance, warehouse, factored receivables, equipment finance, public sector, and commercial real estate and multi-family loans; consumer loans, such as homeowner loans, home equity lines of credit, new and used automobile loans, and personal unsecured loans; and acquisition, development, and construction loans.

In addition, the company engages in the third-party provider to sell mutual funds and annuities; and provision of annuity and wealth management products.

As of December 31, 2018, it operated 106 full-service retail and commercial financial centers, which comprise 24 offices are located in Nassau County, 22 in Suffolk County, 14 in Queens County, 12 in Westchester County, 11 in Kings County, 8 in Rockland County, 6 in Orange County, 3 in New York City, and 2 in Bronx County, as well as 1 office each in Sullivan, Ulster, and Putnam Counties in New York; and 1 office in Bergen County, New Jersey.

The company was founded in 1888 and is based in Montebello, New York.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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