December 14, 2023
Top 10 Stock First Republic Bank Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: First Republic Bank – Top 10 Stock in Dow Jones U.S. Regional Banks Index
First Republic Bank is listed as a top 10 stock on December 14, 2023 in the market index D.J. US Banks because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is below average and thus a signal for caution. Based on the Obermatt 360° View of 71 (high 71% performer), Obermatt assesses an overall buy recommendation for First Republic Bank on December 14, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Regional Banks |
| Index | D.J. US Banks, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View First Republic Bank Buy
| 360 METRICS | December 14, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 99 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 75 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 45 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 17 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 71 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 71 (better than 71% compared with alternatives), overall professional sentiment and financial characteristics for the stock First Republic Bank are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for First Republic Bank. The consolidated Value Rank has an attractive rank of 99, which means that the share price of First Republic Bank is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 99% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 75, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 17. Professional investors are more confident in 83% other stocks. Worryingly, the company has risky financing, with a Safety rank of 45. This means 55% of comparable companies have a safer financing structure than First Republic Bank. ...read more
RECOMMENDATION: With a consolidated 360° View of 71, First Republic Bank is better positioned than 71% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 99 and the Growth Rank above-average at 75, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 17. In addition, the company financing structure is on the riskier side (Safety Rank of 45). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for First Republic Bank negative
ANALYSIS: With an Obermatt Sentiment Rank of 17 (better than 17% compared with alternatives), overall professional sentiment and engagement for the stock First Republic Bank is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for First Republic Bank. Analyst Opinions are at a rank of 1 (worse than 99% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 24 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 1, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 99% of competitors). No wonder, the Professional Investors rank is only 19, which means that professional investors hold less stock in this company than in 81% of alternative investment opportunities. Pros tend to stay away from First Republic Bank, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 17 (less encouraging than 83% compared with investment alternatives), First Republic Bank has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: First Republic Bank Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 99 (better than 99% compared with alternatives) for 2023, First Republic Bank shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for First Republic Bank. Price-to-Sales is 98 which means that the stock price compared with what market professionals expect for future sales is lower than for 98% of comparable companies, indicating a good value for First Republic Bank's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 98% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 98. Compared with other companies in the same industry, dividend yields of First Republic Bank are expected to be higher than for 99% of all competitors (a Dividend Yield rank of 99). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 99, is a buy recommendation based on First Republic Bank's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in First Republic Bank based on its detailed value metrics.
Growth Strategy: First Republic Bank Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 75 (better than 75% compared with alternatives) for 2023, First Republic Bank shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for First Republic Bank. Sales Growth has a value of 77 which means that currently professionals expect the company to grow more than 77% of its competitors. Profit Growth with a value of 81 and Capital Growth with a rank of 88 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 1, which means that stock returns have recently been below 99% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 75, is a buy recommendation for growth and momentum investors. First Republic Bank has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for First Republic Bank, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: First Republic Bank Debt Financing Safety below-average
| SAFETY METRICS | December 14, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 98 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 24 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 25 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 45 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 45 (better than 45% compared with alternatives), the company First Republic Bank has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of First Republic Bank is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for First Republic Bank and the other two below average. Leverage is at a rank of 98 meaning the company has a below-average debt-to-equity ratio. It has less debt than 98% of its competitors.Refinancing is at a rank of 24, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 76% of its competitors. Liquidity is at a rank of 25, meaning that the company generates less profit to service its debt than 75% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 45 (worse than 55% compared with alternatives), First Republic Bank has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of First Republic Bank are on the safer side. ...read more
Combined financial peformance: First Republic Bank Top Financial Performance
| COMBINED PERFORMANCE | December 14, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 99 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 75 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 25 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 91 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), First Republic Bank (Regional Banks, USA) shares have much better financial characteristics than comparable stocks. Shares of First Republic Bank are a good value (attractively priced) with a consolidated Value Rank of 99 (better than 99% of alternatives), show above-average growth (Growth Rank of 75) but are riskily financed (Safety Rank of 45), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on First Republic Bank's financial characteristics. As the company First Republic Bank's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 99) and above-average growth (Obermatt Growth Rank of 75), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 45) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.