HomeTrust Bancshares, Inc. – Value Analysis (NASDAQ:HTBI) : May 19, 2017

Capitalcube gives HomeTrust Bancshares, Inc. a score of 32.

Our analysis is based on comparing HomeTrust Bancshares, Inc. with the following peers – Atlantic Coast Financial Corporation, Charter Financial Corporation, Oconee Federal Financial Corp., Park Sterling Corporation and ASB Bancorp, Inc. (ACFC-US, CHFN-US, OFED-US, PSTB-US and ASBB-US).

Fundamental Overview

HomeTrust Bancshares, Inc. has a fundamental score of 32 and has a relative valuation of NEUTRAL.

Fundamental Score

Company Overview

  • It trades at a lower Price/Book multiple (1.19) than its peer median (1.50).
  • The market expects faster earnings growth from HTBI-US than from its peers and also a turnaround in its current ROE.
  • HTBI-US‘s relatively low net margins and poor capital turns suggest a problematic operating strategy.
  • Changes in annual earnings (relative to peers) are better than the change in its revenues (relative to peers), implying the company is focused more on earnings.
  • Over the last five years, HTBI-US‘s return on equity has declined from about median to less than the median among its peers suggesting that the company’s historical competitiveness in operations is slipping away.
  • While HTBI-US‘s revenues growth has been around the peer median in recent years, the market seems to see faster growth ahead and gives its shares a higher than peer median P/E ratio.
  • The company’s relatively low level of equity capital investment and below peer median returns on capital suggest that the company is in maintenance mode.

Drivers of Margin

  • HTBI-US‘s pre-tax margin suggests relatively high operating costs.
  • The company’s net interest income (net interest income/total revenues) of 85.67% is around peer median suggesting that HTBI-US‘s lending operations does not benefit from any differentiating pricing advantage. In addition, HTBI-US‘s pre-tax margin is less than the peer median (14.49% compared to 28.08%) suggesting relatively high operating costs.
  • The company’s comparatively low proportion of fee based income (i.e. non interest income/total revenues) of 14.33% versus peer median of 21.06% — suggests that HTBI-US‘s operating margins are likely to be more volatile. In addition, HTBI-US‘s proportion of overhead costs (i.e. non interest expense/total revenues) of 77.53x is around peer median — suggesting no cost advantage on fee-based overhead operations.
Drivers of Margins

Quadrant label definitions. Hover to know more

Differentiated; Low Cost, Differentiated; High Cost, Commodity; High Cost, Commodity; Low Cost

Company Profile

HomeTrust Bancshares, Inc. operates as a bank holding company, which offers deposit accounts for individuals, businesses, and nonprofit organizations for HomeTrust Bank. It involves in attracting deposits, including savings money market, demand accounts, and certificates of deposit from the general public. The company was founded on July 10, 2012 and is headquartered in Asheville, NC.