Codorus Valley Bancorp, Inc. :CVLY-US: Earnings Analysis: Q4, 2016 By the Numbers : January 23, 2017

Codorus Valley Bancorp, Inc. reports financial results for the quarter ended December 31, 2016.

We analyze the earnings along side the following peers of Codorus Valley Bancorp, Inc. – Citizens & Northern Corporation, F.N.B. Corporation and Fulton Financial Corporation (CZNC-US, FNB-US and FULT-US) that have also reported for this period.


  • Summary numbers: Revenues of USD 16.63 million, Net Earnings of USD 3.84 million.
  • Net interest income margins narrowed from 84.74% to 84.19% compared to the same period last year.
  • Net loan assets changed 13.22% compared to same period last year and 5.34% from previous period, total deposits changed 15.54% compared to same period last year and 3.44% from previous period.
  • Earnings growth from operating margin improvements as well as from one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income (See complete table at the end of this report):

2016-12-31 2016-09-30 2016-06-30 2016-03-31 2015-12-31
Relevant Numbers (Quarterly)
Revenues (mil) 16.63 15.99 15.65 15.35 14.51
Revenue Growth (%YOY) 14.59 11.29 12.05 9.37 8.74
Earnings (mil) 3.84 3.4 3.04 2.82 2.77
Earnings Growth (%YOY) 38.7 13.02 4.11 15.74 -0.36
Net Margin (%) 23.1 21.29 19.43 18.35 19.09
EPS 0.46 0.38 0.36 0.33 0.4
Return on Equity (%) 9.91 8.83 8.03 7.25 7.7
Return on Assets (%) 0.98 0.9 0.83 0.78 0.78

Access our Ratings and Scores for Codorus Valley Bancorp, Inc.

Market Share Versus Profits

Revenues History
Earnings History

CVLY-US‘s change in revenue this period compared to the same period last year of 14.59% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that CVLY-US is holding onto its market share. Also, for comparison purposes, revenues changed by 4.04% and earnings by 12.90% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Leader, Earnings Focus, Laggard, Revenues Focus

Earnings Growth Analysis

The company’s net interest income margins showed no year-on-year improvement. In spite of this, the earnings rose, influenced primarily by the increase in net interest income after provisions margins from 76.48% to 80.58%. Loan loss provisions as a percentage of net interest income were 4.29% this period, and 9.76% a year ago.

Net Interest Income Margin Versus Loan Loss Provisions Margin

Quadrant label definitions. Hover to know more

High Risk; High Reward Loans, Risky Loan Portfolio, Conservative Loan Portfolio, Safer Loan Portfolio
Net Interest Income Margin History
Loan Loss Provisions Margin History

Net Loans and Total Deposits

A financial institution’s core operations represented by Net Interest Income and Net Interest Income after Provisions are dependent on both the growth and quality of its deposits as well as the growth and quality of its loans. A firm could boost its interest income in the short-term by just increasing its loan assets with less concern about their quality – but this would eventually lead to greater loan loss provisions. Similarly a drive to increase deposits could result in higher interest expenses and eventually effect the firm’s equity. It is thus important to understand net interest income performance in context to loan loss provisions, loan assets and deposits.

Loan Assets Growth Rate History (Qtr YOY)
Total Deposits Growth Rate History (Qtr YOY)

The firm’s decline in net interest income margins came despite the relative increase in the levels of net loan assets. In addition, total deposits as a percentage of equity went from 6.88% to 8.16%. On an absolute basis, net loan assets changed 13.22% compared to the same period last year and 5.34% from the previous period. Total deposits changed 15.54% compared to the same period last year and 3.44% from the previous period.


The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating margins from 27.24% to 33.08% and (2) one-time items. The company’s pretax margins are now 33.08%, compared to 27.24% for the same period last year.

EBIT Margin History
PreTax Margin History
EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables

Access our Ratings and Scores for Codorus Valley Bancorp, Inc.

Company Profile

Codorus Valley Bancorp, Inc. operates as a bank holding company for Peoples Bank, which provides banking and financial services. The company also provides personal banking, mortgage banking, wealth management and real estate services. Codorus Valley Bancorp was founded on October 7, 1986 and is headquartered in York, PA.

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