Trustmark Q3 Earnings: Is NasdaqGS:TRMK Cheap at 0.9x Price/Book?

in EARNINGS/INVESTING IDEAS by

Trustmark Corporation (NasdaqGS:TRMK) is scheduled to report Q3 earnings results after markets close for trading on October 27, 2020.

The company is expected to report earnings of $0.52/share on revenue of $176.3 million. The consensus earnings per share (EPS) of $0.52/share is based on a poll of 5 analysts and represents a decline in eps of −18.8% over the same quarter last year, when the company reported earnings of $0.64/share.

The revenue forecast of $176.3 million based on a poll of 5 analysts implies a year-over-year (YoY) growth in revenue of 10.1%. Last year the company reported $160.1 million in revenue for the quarter.

Expected to report EPS contraction of −18.8% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $176.28 $160.05 10.1%
EPS $0.52 $0.64 −18.8%

Earnings Call Trends

Historically, management has exceeded analyst expectations 4 out of the last 8 tracked quarters, and missed expectations 4 quarters.

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

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.25 $0.51 104.0% Beat
Q1, 2020 $0.44 $0.40 −9.5% Missed
Q4, 2019 $0.56 $0.53 −6.0% Missed
Q3, 2019 $0.62 $0.64 3.2% Beat
Q2, 2019 $0.57 $0.65 14.7% Beat
Q1, 2019 $0.52 $0.51 −2.2% Missed
Q4, 2018 $0.53 $0.55 2.6% Beat
Q3, 2018 $0.57 $0.54 −5.5% 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 June 30, 2020, the stock price reacted by increasing 5.3%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 28, 2020 $22.52 $23.72 5.3% Increase
April 28, 2020 $25.54 $27.40 7.3% Increase
January 28, 2020 $33.20 $32.42 −2.3% Decline
October 22, 2019 $34.99 $34.30 −2.0% Decline

Fundamentals And Technical Analysis

Trustmark Corporation is currently trading at $23.30/share, up 2.1% for the day. The company is trading at approximately 65.1% of its 52-week high of $35.81/share. The company’s stock price is down −1.8% since the last earnings report and up 3.4% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 52.05 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NasdaqGS:TRMK Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 11.42 and a forward P/E multiple of 12.29.

Trustmark Corporation’s current share price also implies a price-to-book (P/B) multiple of 0.88. The following table summarizes some other key fundamental ratios:

Data as of October 21, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $23.30
P/E Ratio 11.4x
P/E Ratio (Fwd) 12.3x
PEG Ratio −1.1
Total Debt / Total Capital 18.2%
Levered Free Cash Flow $117.8 million
Price To Sales 2.4x

Finbox

Trustmark Corporation is a small-cap stock with a market capitalization of $1.478 billion. The company operates in the Financials sector and the Banks industry.

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company offers checking, savings, and money market accounts; individual retirement accounts; certificates of deposits; financing for commercial and industrial projects, income producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit. It also provides mortgage banking services, including construction financing, production of conventional and government insured mortgages, and secondary marketing and mortgage servicing; overdraft facilities; and treasury management services. In addition, the company provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management. Further, it offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers, as well as provides an intermediary vehicle for the provision of loans or investments in low-income communities. As of December 31, 2019, the company operated 178 full-service branches and 15 limited-service branches; and 236 automated teller machines and 14 interactive teller machines. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.

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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