We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
6 Reasons Why Pathward Financial (CASH) Stock Is Worth Buying
Read MoreHide Full Article
Pathward Financial, Inc. (CASH - Free Report) is expected to enjoy balance sheet growth, supported by the rise in loan demand and a stable deposit base. This, along with low leverage, indicates that it might be prudent to add the stock to your portfolio now.
Analysts seem to be optimistic regarding the company’s growth prospects. In the past 60 days, the Zacks Consensus Estimate for CASH’s earnings has moved 1.7% and 2.5% upward for fiscal 2024 and fiscal 2025, respectively. The company currently carries a Zacks Rank #2 (Buy).
Looking at its price performance, in the past year, shares of Pathward Financial have risen 7.5% against the industry’s 9.2% fall.
Image Source: Zacks Investment Research
Here are some of the factors that make CASH a viable investment option right now:
Earnings Growth: Over the past three to five years, Pathward Financial recorded earnings growth of 24.5%, significantly higher than the industry average of 6.8%. The rising trend is likely to continue in the upcoming years as well. The company’s earnings are projected to rise 5.6% for fiscal 2024 and 6.7% for fiscal 2025.
CASH has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed in one, with an average beat of 5.69%.
Balance Sheet Growth: CASH’s deposits have witnessed a compound annual growth rate (CAGR) of 9.8% over the last three years (ended fiscal 2023). The company’s differentiated Banking-as-a-Service (BaaS) model has been advantageous as it offers stable and low-cost funding via partner relationships. A stable funding base will enable the company to remain active on the lending front. Total loans and leases witnessed a three-year (2020-2023) CAGR of 9.5%. The continuation of such trends will fortify CASH’s balance sheet.
Revenue Strength: Pathward Financial has been witnessing a steady improvement in revenues. The company’s revenues witnessed a CAGR of 12.2% over the last three years (2020-2023). This was driven by solid loan demand, high rates and non-interest income growth.
Total revenues are projected to increase 6.5% in fiscal 2024 and 2.9% in fiscal 2025.
Strong Leverage: Currently, CASH has a debt/equity ratio of 0.05. This compares favorably with the industry average of 0.36. Given the relatively low debt/equity ratio than its peers, the company is expected to be financially stable, even in adverse economic conditions.
Favorable Return on Equity: CASH’s trailing 12-month return on equity (ROE) indicates its growth potential. The company’s ROE of 25.09% compares favorably with 8.61% for the industry. Thus, this reflects that the company is more efficient in using shareholder funds.
Stocks Seems Undervalued: Pathward Financial’s stock seems undervalued as its price-to-earnings (F1) and price-to-cash flow ratios of 8.23 and 6.06, respectively, are below the industry averages of 9.96 and 7.93.
Further, it has a Value Score of A. The Value Score condenses all valuation metrics into one actionable score that helps investors steer clear of “value traps” and identify stocks that are truly trading at a discount. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Other Stocks Worth Considering
Some other top-ranked bank stocks are First Financial Bancorp. (FFBC - Free Report) and First BanCorp. (FBP - Free Report) .
Estimates for First Financial Bancorp’s 2024 earnings have been revised 5.2% upward in the past two months. The company’s shares have risen 1% over the past years. Currently, FFBC sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Estimates for First BanCorp’s earnings for the current year have moved 9.3% north in the past 60 days. The company’s shares have risen 38.2% over the past year. At present, FBP carries a Zacks Rank of 2.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
6 Reasons Why Pathward Financial (CASH) Stock Is Worth Buying
Pathward Financial, Inc. (CASH - Free Report) is expected to enjoy balance sheet growth, supported by the rise in loan demand and a stable deposit base. This, along with low leverage, indicates that it might be prudent to add the stock to your portfolio now.
Analysts seem to be optimistic regarding the company’s growth prospects. In the past 60 days, the Zacks Consensus Estimate for CASH’s earnings has moved 1.7% and 2.5% upward for fiscal 2024 and fiscal 2025, respectively. The company currently carries a Zacks Rank #2 (Buy).
Looking at its price performance, in the past year, shares of Pathward Financial have risen 7.5% against the industry’s 9.2% fall.
Image Source: Zacks Investment Research
Here are some of the factors that make CASH a viable investment option right now:
Earnings Growth: Over the past three to five years, Pathward Financial recorded earnings growth of 24.5%, significantly higher than the industry average of 6.8%. The rising trend is likely to continue in the upcoming years as well. The company’s earnings are projected to rise 5.6% for fiscal 2024 and 6.7% for fiscal 2025.
CASH has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed in one, with an average beat of 5.69%.
Balance Sheet Growth: CASH’s deposits have witnessed a compound annual growth rate (CAGR) of 9.8% over the last three years (ended fiscal 2023). The company’s differentiated Banking-as-a-Service (BaaS) model has been advantageous as it offers stable and low-cost funding via partner relationships. A stable funding base will enable the company to remain active on the lending front. Total loans and leases witnessed a three-year (2020-2023) CAGR of 9.5%. The continuation of such trends will fortify CASH’s balance sheet.
Revenue Strength: Pathward Financial has been witnessing a steady improvement in revenues. The company’s revenues witnessed a CAGR of 12.2% over the last three years (2020-2023). This was driven by solid loan demand, high rates and non-interest income growth.
Total revenues are projected to increase 6.5% in fiscal 2024 and 2.9% in fiscal 2025.
Strong Leverage: Currently, CASH has a debt/equity ratio of 0.05. This compares favorably with the industry average of 0.36. Given the relatively low debt/equity ratio than its peers, the company is expected to be financially stable, even in adverse economic conditions.
Favorable Return on Equity: CASH’s trailing 12-month return on equity (ROE) indicates its growth potential. The company’s ROE of 25.09% compares favorably with 8.61% for the industry. Thus, this reflects that the company is more efficient in using shareholder funds.
Stocks Seems Undervalued: Pathward Financial’s stock seems undervalued as its price-to-earnings (F1) and price-to-cash flow ratios of 8.23 and 6.06, respectively, are below the industry averages of 9.96 and 7.93.
Further, it has a Value Score of A. The Value Score condenses all valuation metrics into one actionable score that helps investors steer clear of “value traps” and identify stocks that are truly trading at a discount. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Other Stocks Worth Considering
Some other top-ranked bank stocks are First Financial Bancorp. (FFBC - Free Report) and First BanCorp. (FBP - Free Report) .
Estimates for First Financial Bancorp’s 2024 earnings have been revised 5.2% upward in the past two months. The company’s shares have risen 1% over the past years. Currently, FFBC sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Estimates for First BanCorp’s earnings for the current year have moved 9.3% north in the past 60 days. The company’s shares have risen 38.2% over the past year. At present, FBP carries a Zacks Rank of 2.