Peoples Bancorp, Inc. (Ohio) :PEBO-US: Earnings Analysis: Q3, 2017 By the Numbers : October 30, 2017

Peoples Bancorp, Inc. (Ohio) reports financial results for the quarter ended September 30, 2017.

We analyze the earnings along side the following peers of Peoples Bancorp, Inc. (Ohio) – First Financial Bancorp., Park National Corporation, Ohio Valley Banc Corp., Farmers National Banc Corp., LCNB Corp., Old National Bancorp, Huntington Bancshares Incorporated and United Bancorp, Inc. (FFBC-US, PRK-US, OVBC-US, FMNB-US, LCNB-US, ONB-US, HBAN-US and UBCP-US) that have also reported for this period.

Highlights

  • Summary numbers: Revenues of USD 43.70 million, Net Earnings of USD 10.84 million.
  • Net interest income margins widened from 66.24% to 66.86% compared to the same period last year.
  • Net loan assets changed 7.30% compared to same period last year and 1.43% from previous period, total deposits changed 3.46% compared to same period last year and -0.47% 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):

2017-09-30 2017-06-30 2017-03-31 2016-12-31 2016-09-30
Relevant Numbers (Quarterly)
Revenues (mil) 43.7 41.67 40.62 38.81 39.44
Revenue Growth (%YOY) 10.83 5.57 4.38 3.44 5.29
Earnings (mil) 10.84 9.71 8.77 7.36 7.76
Earnings Growth (%YOY) 39.65 22.48 9.64 187.3 89.18
Net Margin (%) 24.8 23.3 21.58 18.95 19.68
EPS 0.6 0.53 0.48 0.4 0.43
Return on Equity (%) 2.39 2.17 2 1.68 1.77
Return on Assets (%) 1.22 1.11 1.02 0.87 0.93

Access our Ratings and Scores for Peoples Bancorp, Inc. (Ohio)

Market Share Versus Profits

Revenues History
Earnings History

PEBO-US’s change in revenue this period compared to the same period last year of 10.83% 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 PEBO-US is holding onto its market share. Also, for comparison purposes, revenues changed by 4.87% and earnings by 11.62% 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 earnings growth was influenced by the following factors: (1) Year-on-year improvements in net interest income margins from 66.24% to 66.86% and (2) improvement in loan loss provisions. As a result, net interest income after provisions margins improved from 63.34% to 64.37% compared to the same period last year. Loan loss provisions as a percentage of net interest income were 3.72% this period and 4.39% 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 improvement in net interest income margins was influenced by the relative increase in the level of net loan assets. In addition, total deposits as a percentage of equity went from 5.84% to 5.83%. On an absolute basis, net loan assets changed 7.30% compared to the same period last year and 1.43% from the previous period, while total deposits changed 3.46% compared to the same period last year and -0.47% from the previous period.

Margins

The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating margins from 29.03% to 36.75% and (2) one-time items. The company’s pretax margins are now 36.66%, compared to 29.03% 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 Peoples Bancorp, Inc. (Ohio)

Company Profile

Peoples Bancorp, Inc. is a diversified financial products and services company, which makes available a complete line of banking, investment, insurance, and trust solutions. It products include demand deposit accounts, savings accounts, money market accounts and certificates of deposit; commercial, consumer and real estate mortgage loans; debit and automated teller machine cards. The company was founded in 1980 and is headquartered in Marietta, OH.

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