Westamerica Bancorporation (WABC) AI Stock Analysis

• Market Cap: $1.21B
• Dividend Yield: 3.98%
• Average Volume (3M): 163.23K
• Price to Earnings (P/E): 9.2
• Beta (1Y): 0.74
• Revenue Growth: -7.38%
• EPS Growth: -15.58%
• Country: US
• Employees: 616
• Sector: Financial
• Sector Strength: 77
• Industry: Banks - Regional
• EPS (TTM): 1.16
• Shares Outstanding: 26,180,676
• 10 Day Avg. Volume: 140,854
• 30 Day Avg. Volume: 163,226
• PEG Ratio: -2.40
• Price to Book (P/B): 1.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.30
• Enterprise Value/Market Cap: 0.51
• Enterprise Value/Revenue: 0.49
• Enterprise Value/Gross Profit: 2.16
• Enterprise Value/Ebitda: 0.75
• 1Y Price Target: $52.50
• Price Target Upside: 13.71% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 70 Outperform
• Price Target: $51.00 ▲(10.46%Upside)

Westamerica Bancorporation's strong financial performance and attractive valuation underpin its overall score. However, technical indicators suggest bearish momentum, which impacts the stock's short-term outlook. The absence of recent earnings call data and corporate events limits additional insights into future performance. Overall, while the stock offers strong financial fundamentals, potential investors should be cautious of the current bearish technical trends.

Positive Factors

Credit Quality

WABC's credit quality remains very strong, with non-accrual loans equal to only 0.02% of total loans and a high level of reserve coverage.

Expense Management

WABC is regarded as an exceptional bank with pristine credit quality and excellent expense management.

Negative Factors

Net Interest Margin

The net interest margin has decreased.

Profitability

A slow but steady decline in profitability is expected in the coming quarters.

Westamerica Bancorporation Business Overview & Revenue Model

Company Description

Westamerica Bancorporation operates as a bank holding company for the Westamerica Bank that provides various banking products and services to individual and commercial customers. The company accepts various deposit products, including retail savings and checking accounts, as well as certificates of deposit. Its loan portfolio includes commercial, commercial and residential real estate, real estate construction, and consumer installment loans, as well as indirect automobile loans. It operates through 78 branch offices in 21 counties in Northern and Central California. The company was formerly known as Independent Bankshares Corporation and changed its name to Westamerica Bancorporation in 1983. The company was incorporated in 1972 and is headquartered in San Rafael, California.

How the Company Makes Money

Westamerica Bancorporation primarily generates revenue through interest income from its loan portfolio and investment securities. The company earns money by providing loans to individuals and businesses, charging interest on these loans, and collecting fees for various banking services. Additionally, Westamerica Bancorporation generates non-interest income through service charges on deposit accounts, fees for managing assets, and other financial services. The company's profitability is influenced by its ability to manage interest rate spreads, maintain low-cost deposits, and efficiently manage its operating expenses. Strategic partnerships, such as collaborations with financial service providers and community organizations, also contribute to its revenue streams.

Westamerica Bancorporation Financial Statement Overview

Summary

Westamerica Bancorporation showcases strong financial health across all statements. The income statement highlights high profitability despite a decline in revenue. The balance sheet reflects low leverage and effective equity utilization, while cash flow analysis indicates robust cash generation and management. The company's financial stability and profitability position it well within the regional banking industry, though attention to revenue growth remains important for future performance.

Income Statement

The income statement reflects strong profitability with a high gross profit margin of approximately 94.27% and a solid net profit margin of 44.09% for TTM (Trailing-Twelve-Months). Despite a decrease in total revenue by 8.99% compared to the previous annual report, the company maintains robust EBIT and EBITDA margins at 60.05% and 63.17%, respectively. The high margins indicate effective cost management, although the revenue decline suggests potential challenges in revenue generation.

Balance Sheet

The balance sheet demonstrates stability with a low debt-to-equity ratio of 0.14, indicating low leverage. The return on equity is strong at 14.44%, suggesting efficient use of shareholder funds. Additionally, the equity ratio stands at 15.47%, reflecting a conservative capital structure. The company's strong equity position and low debt levels contribute to its financial resilience, though the modest equity ratio highlights a smaller proportion of equity financing relative to total assets.

Cash Flow

Cash flow analysis shows strong operational performance with a high operating cash flow to net income ratio of 0.99 and a robust free cash flow to net income ratio of 0.97. The company exhibits a positive free cash flow growth rate of 15.11% compared to the previous annual report, indicating effective cash management and the ability to generate cash beyond operational needs. This strong cash flow performance enhances the company's financial flexibility.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
302.14M	311.17M	327.54M	266.88M	216.79M	207.96M
	Gross Profit
284.87M	293.45M	324.80M	264.95M	214.83M	201.83M
	EBIT
181.46M	189.06M	221.58M	165.59M	117.03M	106.80M
	EBITDA
190.91M	199.46M	233.35M	182.16M	133.64M	129.45M
	Net Income Common Stockholders
133.26M	138.64M	161.77M	122.03M	86.51M	80.41M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.90B	1.94B	4.19B	4.63B	5.77B	4.68B
	Total Assets
5.97B	6.08B	6.36B	6.95B	7.46B	6.75B
	Total Debt
133.21M	138.31M	76.98M	73.54M	164.23M	121.38M
	Net Debt
-594.13M	-463.19M	-113.34M	-220.70M	-967.86M	-499.90M
	Total Liabilities
5.04B	5.19B	5.59B	6.35B	6.63B	5.90B
	Stockholders Equity
923.14M	889.96M	772.89M	602.11M	827.10M	844.81M
Cash Flow		Free Cash Flow
129.93M	139.83M	157.05M	112.89M	87.41M	105.54M
	Operating Cash Flow
131.75M	141.57M	158.21M	113.70M	88.73M	107.74M
	Investing Cash Flow
843.12M	715.68M	547.27M	-631.29M	-306.08M	-748.92M
	Financing Cash Flow
-681.79M	-446.07M	-809.40M	-320.26M	728.16M	889.03M

Westamerica Bancorporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 46.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WABC, the sentiment is Negative. The current price of 46.17 is below the 20-day moving average (MA) of 47.77, below the 50-day MA of 47.84, and below the 200-day MA of 50.08, indicating a bearish trend. The MACD of -0.60 indicates Positive momentum. The RSI at 36.84 is Neutral, neither overbought nor oversold. The STOCH value of 13.45 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WABC.

Westamerica Bancorporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STEL	77 Outperform	$1.38B	12.38	7.40%	2.08%	-0.58%	-3.02%
VBTX	74 Outperform	$1.32B	11.92	7.07%	3.62%	1.41%	19.00%
HOPE	71 Outperform	$1.30B	12.98	4.44%	5.51%	-11.94%	-21.67%
CCB	71 Outperform	$1.29B	25.43	12.78%	―	16.62%	18.72%
WABC	70 Outperform	$1.21B	9.24	15.54%	3.98%	-7.38%	-15.58%
TCBK	68 Neutral	$1.28B	11.41	9.38%	3.38%	3.01%	4.55%
Sector *	64 Neutral	$6.48B	10.79	6.50%	5.16%	24.88%	-1.54%

Westamerica Bancorporation Corporate Events

Westamerica Bancorporation Announces Executive Leadership Transition

Westamerica Bancorporation has announced the retirement of John “Robert” A. Thorson from his role as Senior Vice President and Treasurer, effective January 24, 2025, after more than 35 years of service. John Sousa has been appointed as the new Senior Vice President and Treasurer, effective January 27, 2025, following his initial joining of the company in July 2024, bringing with him extensive experience in investment portfolio management and derivatives execution from Bank of the West.