A private and business banking institution that provides real estate lending, wealth management, and trust services, First Republic Bank has recently seen changes in its shareholder base. American Century Companies Inc., Prudential PLC, Cetera Investment Advisers, Vanguard Group Inc., and Candriam Luxembourg S.C.A have all adjusted their positions in the company. The number of shares held by some investors grew by as much as 129.4 per cent, indicating increasing confidence in First Republic Bank’s ability to deliver returns.
As of Friday’s opening trading price of US$14.03, the Bank had a market capitalization value of US$2.52 billion with a price-to-earnings ratio of 1.70 and a beta rating of 1.01. This reflects the company’s recovery efforts after experiencing a wide range between its twelve-month high of US$171.09 and low at US$11.52.
First Republic Bank is operatively divided into two segments: Commercial Banking and Wealth Management.The former comprises retail deposit gathering, real estate secured lending, mortgage sales and servicing relevant to managing capital liquidity and interest rate risk while the latter segment deals with aspects such as custody services.
In addition to recent investor activity, First Republic Bank disclosed paying out its quarterly dividend on February 9th with investors being paid US$0.27 per share for the quarter ending December 31st last year; shareholders recorded on January 26th qualified for this payout which amounts to an annualized yield of 7.70 per cent. This represents dividends worth around 13.09 per cent payout ratio from First Republic Bank.
Various equity research analysts have been giving their viewpoints regarding how well First Republic Bank will fare going forward.One such researcher leading the optimism trend is Sterne Agee CRT which offered an “overweight” rating following assessment that raised its price target for shares in First Republic bank from US$130.00 to US$140.Others e.g Morgan Stanley and Compass point attribute the prevailing challenges crippling First Republic Bank’s performance in what is otherwise considered as optimistic times by for the company’s industry. As indicated on Bloomberg, majority of those analyzing First Republic Bank opine that investors today may want to wait it out with a “Hold” rating.There are however some market watchers with upgraded recommendations on this stock which will be worth keeping an eye on over subsequent periods.
Over the last nine years, Elaine has managed investment portfolio using fundamental analysis and value investing, emphasizing long-term time horizons.
