Natixis SA – Value Analysis (EURONEXT PARIS:KN) : December 29, 2017

Capitalcube gives Natixis SA a score of 64.

Our analysis is based on comparing Natixis SA with the following peers – Credit Agricole SA, Societe Generale S.A. Class A and BNP Paribas SA Class A (ACA-FR, GLE-FR and BNP-FR).

Fundamental Overview

Natixis SA has a fundamental score of 64 and has a relative valuation of OVERVALUED.

Fundamental Score

Company Overview

  • It currently trades at a Price/Book ratio of (1.00).
  • The market expects KN-FR to grow at about the same rate as the peers and to maintain the median returns it currently generates.
  • KN-FR‘s median net profit margins and relatively high capital efficiency give it some operating leverage.
  • The company’s year-on-year change in revenues and earnings are better than the median among its peer group.
  • KN-FR‘s return on equity currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.
  • While KN-FR‘s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company’s level of equity capital investment suggests it might be under-investing in a business with above median returns.
  • KN-FR might have enough interest coverage to take-on additional debt prudently.

Drivers of Margin

  • KN-FR‘s lending operations might be constrained on pricing.
  • The company’s comparatively low proportion of net interest income (net interest income/total revenues) of 13.68% versus peer median of 26.27% suggests that KN-FR‘s lending operations might be constrained on pricing. However, KN-FR‘s pre-tax margin of 12.44% is around the peer median suggesting lower operating costs relative to peers.
  • The company’s proportion of fee based income (i.e. non interest income/total revenues) of 86.32% is around peer median. In addition, KN-FR‘s proportion of overhead costs (i.e. non interest expense/total revenues) of 86.84x is also 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

Natixis SA engages in the provision of international corporate, investment, insurance, and financial services. It operates through the following segments: Corporate and Investment Banking, Investment Solutions, Specialized Financial Services, Coface, Financial Investments, and Other Activities. The Corporate and Investment Banking segment advises businesses, institutional investors, insurance companies, banks and publics sector entities and offers them a diversified line of financing solutions as well as access to capital markets. The Investment Solutions segment includes asset management, insurance, private banking and the private equity for third party clients business line. The Specialized Financial Services deals with factoring, lease financing, consumer credit, guarantees, film industry finance, employee benefits planning, and payment and securities services. The Coface segment involves in credit insurance, international factoring solutions, business information and ratings, receivables management, and management of public procedures. The company was founded on November 20, 1919 and is headquartered in Paris, France.