Q3 Earnings Preview for CVB Financial (NasdaqGS:CVBF)

in EARNINGS/INVESTING IDEAS by

CVB Financial Corp. (NasdaqGS:CVBF) is scheduled to report Q3 earnings results after markets close for trading on October 21, 2020.

The company is expected to report earnings of $0.33/share on revenue of $118 million. The consensus earnings per share (EPS) of $0.33/share is based on a poll of 6 analysts and represents a decline in eps of −7.8% over the same quarter last year, when the company reported earnings of $0.36/share.

The revenue forecast of $118 million based on a poll of 4 analysts implies a year-over-year (YoY) decline in revenue of −2.1%. Last year the company reported $120.5 million in revenue for the quarter.

Expected to report EPS contraction of −7.8% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $117.97 $120.45 −2.1%
EPS $0.33 $0.36 −7.8%

Earnings Call Trends

Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.

What are your expectations from CVB Financial Corp. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.27 $0.31 17.0% Beat
Q1, 2020 $0.31 $0.27 −13.8% Missed
Q4, 2019 $0.36 $0.37 3.5% Beat
Q3, 2019 $0.37 $0.36 −2.0% Missed
Q2, 2019 $0.37 $0.37 0.7% Beat
Q1, 2019 $0.35 $0.36 2.9% Beat
Q4, 2018 $0.34 $0.35 2.9% Beat
Q3, 2018 $0.32 $0.34 5.0% 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. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 2.5%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 22, 2020 $18.44 $18.91 2.5% Increase
April 22, 2020 $19.33 $19.08 −1.3% Decline
January 22, 2020 $21.29 $21.62 1.6% Increase
October 23, 2019 $21.42 $20.42 −4.7% Decline

Fundamentals And Technical Analysis

CVB Financial Corp. is currently trading at $17.94/share, up 0.4% for the day. The company is trading at approximately 81.4% of its 52-week high of $22.22/share. The company’s stock price is down −5.1% since the last earnings report and down −1.8% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 51.36 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NasdaqGS:CVBF Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 13.46 and a forward P/E multiple of 14.36.

CVB Financial Corp.’s current share price also implies a price-to-book (P/B) multiple of 1.24. The following table summarizes some other key fundamental ratios:

Data as of October 19, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $17.94
P/E Ratio 13.5x
P/E Ratio (Fwd) 14.4x
PEG Ratio −2.8
Total Debt / Total Capital 18.9%
Levered Free Cash Flow $218.2 million
Price To Sales 5.5

Finbox

CVB Financial Corp. is a mid-cap stock with a market capitalization of $2.422 billion. The company operates in the Financials sector and the Banks industry.

CVB Financial Corp. operates as a bank holding company for Citizens Business Bank that provides banking and financial services. The company offers checking, savings, money market, and time certificates of deposit products for business and personal accounts; and serves as a federal tax depository for business customers. It also provides commercial lending products comprising lines of credit and other working capital financing, accounts receivable lending, and letters of credit; loans to finance the operating needs of wholesale dairy farm operations, cattle feeders, livestock raisers, and farmers; lease financing services for municipal governments; commercial real estate and construction loans that are secured by owner-occupied and investor owned properties; and consumer financing products, including automobile leasing and financing, lines of credit, credit cards, home mortgages, and home equity loans and lines of credit. In addition, the company offers various specialized services, such as cash management systems for monitoring cash flow, a credit card program for merchants, courier pick-up and delivery, payroll services, remote deposit capture, electronic funds transfer, and online account access. Further, it provides trust and investment-related services to customers through its CitizensTrust Division, such as fiduciary services, mutual funds, annuities, 401(k) plans, and individual investment accounts. The company’s customers consist primarily of small to mid-sized businesses and individuals. As of December 31, 2019, the company operated 58 banking centers located in the Inland Empire, Los Angeles County, Orange County, San Diego County, Ventura County, Santa Barbara County, and the Central Valley area of California; one loan production office located in Modesto, California; and three trust offices located in Ontario, Newport Beach, and Pasadena. CVB Financial Corp. was founded in 1974 and is headquartered in Ontario, California.

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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