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Bankunited (BKU)
NYSE:BKU
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BankUnited
(NYSE:BKU)
66Neutral
Positive Factors
Financial Performance
The company posted its most profitable quarter in nearly two years, with a notable return on assets and equity.
Net Interest Margin
BankUnited reported better than expected NIM expansion and lower provision drove an EPS beat.
Negative Factors
Loan Growth
Loan growth on a period end basis decreased 4% annualized Q/Q driven by declines in all loan categories excluding commercial real estate.
BankUnited (BKU) vs. S&P 500 (SPY)
Market Cap
$2.43B
Dividend Yield3.7%
Average Volume (3M)734.40K
Price to Earnings (P/E)10.2
Beta (1Y)1.68
Revenue Growth3.42%
EPS Growth30.07%
CountryUS
Employees1,616
SectorFinancial
Sector Strength77
IndustryBanking
Share Statistics
EPS (TTM)3.08
Shares Outstanding74,751,080
10 Day Avg. Volume981,426
30 Day Avg. Volume734,400
Financial Highlights & Ratios
PEG Ratio0.34
Price to Book (P/B)N/A
Price to Sales (P/S)2.45
Price to Cash Flow (P/CF)3.20
P/FCF Ratio1.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$44.50Price Target Upside33.47% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
BankUnited Business Overview & Revenue Model
Company DescriptionBankUnited, Inc. (BKU) is a bank holding company headquartered in Miami Lakes, Florida, primarily serving commercial and consumer customers. The company operates through its banking subsidiary, BankUnited, N.A., offering a wide range of financial products and services, including personal and business banking, commercial loans, real estate financing, and treasury management services. BankUnited focuses on providing high-quality banking solutions, leveraging its strong presence in the Florida market and its expansion in the New York metropolitan area.
How the Company Makes MoneyBankUnited generates revenue primarily through interest income from its loan portfolio, which includes commercial and industrial loans, real estate loans, and consumer loans. The company also earns money from interest on securities and other investments. Additionally, BankUnited derives non-interest income from various sources, such as service charges on deposit accounts, fees from treasury management services, and other financial service fees. The bank's profitability is influenced by factors like net interest margin, loan growth, asset quality, and the overall economic environment. Strategic partnerships and a focus on expanding its customer base in key geographic regions also contribute to its revenue growth.
BankUnited Financial Statement Overview
Summary
BankUnited displays strong revenue growth and a solid profit margin. The company benefits from a healthy capital structure with no debt. However, the decline in return on equity and stagnant free cash flow growth suggest potential issues in operational efficiency and cash generation.Income Statement
BankUnited shows a strong gross profit margin consistently at 100%, which is typical for financial institutions where revenue equals gross profit. The net profit margin for 2024 is approximately 12.07%, a slight increase from the previous year. Revenue growth has been impressive, with a substantial increase of 120.49% from 2023 to 2024, indicating robust business expansion. However, the lack of EBITDA data limits a complete profitability analysis.85
Very Positive
Balance Sheet
The company maintains a solid equity position with an equity ratio of 7.99% in 2024, indicating a strong capital base. The debt-to-equity ratio is favorable at 0, showcasing low financial leverage and risk. However, the return on equity has decreased to 8.26% in 2024, down from 13.81% the previous year, suggesting declining efficiency in generating profits from shareholders' equity.70
Positive
Cash Flow
BankUnited's free cash flow remained stable, with no growth reported in 2024. The operating cash flow to net income ratio is 0.42, indicating moderate cash generation from operations relative to net income. The absence of growth in free cash flow presents concerns over cash generation potential despite positive cash flow metrics.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.93B | 873.03M | 990.60M | 929.84M | 884.98M | Gross Profit |
| 1.93B | 873.03M | 990.60M | 929.84M | 884.98M | EBIT |
| 1.91B | 237.08M | 711.88M | 449.38M | 249.36M | EBITDA |
| 0.00 | 0.00 | 452.75M | 527.88M | 321.87M | Net Income Common Stockholders |
| 232.47M | 178.67M | 284.97M | 414.98M | 197.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 9.62B | 588.28M | 572.65M | 314.86M | 397.72M | Total Assets |
| 35.24B | 35.76B | 37.03B | 35.82B | 35.01B | Total Debt |
| 3.64B | 5.82B | 6.14B | 2.63B | 3.85B | Net Debt |
| 3.15B | 5.24B | 5.57B | 2.31B | 3.45B | Total Liabilities |
| 32.43B | 33.18B | 34.59B | 2.63B | 3.85B | Stockholders Equity |
| 2.81B | 2.58B | 2.44B | 3.04B | 2.98B |
| Cash Flow | Free Cash Flow | |||
| 97.79M | 657.50M | 1.24B | 1.18B | 844.57M | Operating Cash Flow |
| 97.79M | 657.50M | 1.29B | 1.22B | 864.17M | Investing Cash Flow |
| 5.00M | 980.57M | -2.12B | -1.64B | -2.62B | Financing Cash Flow |
| -90.48M | -1.62B | 1.08B | 334.87M | 1.94B |
BankUnited Technical Analysis
Negative
33.34
Price Trends
38.58
Negative
38.68
Negative
35.84
Negative
Market Momentum
-1.88
Positive
25.49
Positive
13.17
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKU, the sentiment is Negative. The current price of 33.34 is below the 20-day moving average (MA) of 37.24, below the 50-day MA of 38.58, and below the 200-day MA of 35.84, indicating a bearish trend. The MACD of -1.88 indicates Positive momentum. The RSI at 25.49 is Positive, neither overbought nor oversold. The STOCH value of 13.17 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BKU.
BankUnited Risk Analysis
BankUnited disclosed 44 risk factors in its most recent earnings report. BankUnited reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
BankUnited Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $19.01B | 11.14 | 10.72% | 4.67% | 2.70% | -8.16% | |
70 Outperform | $6.73B | 14.18 | 6.60% | 3.20% | 11.96% | 11.66% | |
69 Neutral | $7.00B | 9.54 | 13.15% | 3.56% | 7.91% | 13.79% | |
66 Neutral | $2.43B | 10.18 | 9.90% | 3.70% | 3.42% | 30.07% | |
64 Neutral | $7.48B | 11.21 | 10.72% | 4.99% | -6.54% | -21.90% | |
64 Neutral | $13.79B | 10.52 | 9.20% | 4.24% | 17.25% | -7.60% | |
61 Neutral | $9.49B | 13.05 | 8.70% | 3.39% | 4.56% | -13.90% |
* Financial Sector Average
Performance Comparison
BKU
BankUnited
33.34
7.09
27.01%
CMA
Comerica
57.75
8.68
17.69%
FHN
First Horizon
18.73
4.41
30.80%
PB
Prosperity Bancshares
70.30
9.93
16.45%
RF
Regions Financial
21.06
2.48
13.35%
ZION
Zions Bancorporation National Association
47.94
8.22
20.69%
BankUnited Earnings Call Summary
Earnings Call Date: Jan 22, 2025 | % Change Since: -16.92% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong financial performance with significant EPS growth, improved net interest margin, and robust deposit growth. However, challenges remain with a decline in the loan portfolio, an increase in non-performing loans, and the expectation of higher provisions in the coming year.Highlights
Exceptional Earnings Per Share Growth
Earnings per share (EPS) increased from $0.62 in Q4 2023 to $0.91 in Q4 2024, surpassing the consensus of $0.73.
Net Interest Margin Improvement
Net interest margin increased to 2.84% in Q4 2024 from 2.78% in the previous quarter, driven by reduced deposit costs.
Strong Non-Interest Deposits Growth
Non-interest-bearing demand deposits (NIDDA) grew by $781 million for the year, contributing to overall deposit growth.
Credit Quality and Capital Strength
Net charge-offs were low at 16 basis points, with a CET1 capital ratio of 12% and a book value per share of $36.61.
Lowlights
Loan Portfolio Decline
Overall loans decreased by $101 million due to runoff in residential and non-core portfolios like leasing and franchise finance.
Increased Non-Performing Loans
Non-performing loans (NPLs) increased by $26 million, mainly due to one office loan.
Expectation of Higher Provision in 2025
The provision for loan losses is expected to increase in 2025 due to shifts in portfolio composition toward commercial loans.
Company Guidance
During the BankUnited Q4 2024 earnings call, the company provided detailed guidance for the upcoming year, emphasizing continued strong performance and strategic focus. Key metrics highlighted included an EPS growth trajectory from $0.62 in Q4 2023 to $0.91 in Q4 2024, with a net interest margin rising from 2.60% to 2.84% over the same period. The return on assets (ROA) improved from 52 basis points to 78 basis points, while the return on equity (ROE) increased from 7.3% to 9.7%. BankUnited's leadership outlined plans to grow noninterest-bearing demand deposits by double digits and total deposits by mid-single digits, aiming for a net interest margin exceeding 3% by late 2025. The call also noted a focus on maintaining a strong balance sheet, with a loan-to-deposit ratio at 87.2% and a CET1 capital ratio of 12%. Despite competition, the bank intends to sustain its strategic growth in core commercial segments while managing challenges in market conditions.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.