Financial Analysis: Berkshire Hills Bancorp (BHLB) & Its Peers

Berkshire Hills Bancorp (NYSE: BHLB) is one of 26 public companies in the “Retail & Mortgage Banks” industry, but how does it contrast to its competitors? We will compare Berkshire Hills Bancorp to related businesses based on the strength of its institutional ownership, earnings, dividends, risk, profitability, valuation and analyst recommendations.

Risk and Volatility

Berkshire Hills Bancorp has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500. Comparatively, Berkshire Hills Bancorp’s competitors have a beta of 0.83, suggesting that their average stock price is 17% less volatile than the S&P 500.

Insider & Institutional Ownership

74.1% of Berkshire Hills Bancorp shares are held by institutional investors. Comparatively, 54.7% of shares of all “Retail & Mortgage Banks” companies are held by institutional investors. 1.7% of Berkshire Hills Bancorp shares are held by company insiders. Comparatively, 12.8% of shares of all “Retail & Mortgage Banks” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Berkshire Hills Bancorp and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Berkshire Hills Bancorp $336.88 million N/A 21.48
Berkshire Hills Bancorp Competitors $678.45 million $169.32 million 12.27

Berkshire Hills Bancorp’s competitors have higher revenue and earnings than Berkshire Hills Bancorp. Berkshire Hills Bancorp is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a summary of current ratings for Berkshire Hills Bancorp and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Berkshire Hills Bancorp 0 2 3 0 2.60
Berkshire Hills Bancorp Competitors 108 447 480 12 2.38

Berkshire Hills Bancorp currently has a consensus price target of $37.70, indicating a potential downside of 3.58%. As a group, “Retail & Mortgage Banks” companies have a potential upside of 28.32%. Given Berkshire Hills Bancorp’s competitors higher probable upside, analysts plainly believe Berkshire Hills Bancorp has less favorable growth aspects than its competitors.

Profitability

This table compares Berkshire Hills Bancorp and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Berkshire Hills Bancorp 15.03% 6.93% 0.85%
Berkshire Hills Bancorp Competitors 14.79% -27.48% 0.87%

Dividends

Berkshire Hills Bancorp pays an annual dividend of $0.84 per share and has a dividend yield of 2.1%. Berkshire Hills Bancorp pays out 46.2% of its earnings in the form of a dividend. As a group, “Retail & Mortgage Banks” companies pay a dividend yield of 1.6% and pay out 28.7% of their earnings in the form of a dividend. Berkshire Hills Bancorp has increased its dividend for 2 consecutive years.

About Berkshire Hills Bancorp

Berkshire Hills Bancorp, Inc. (Berkshire) is a holding company for Berkshire Bank (the Bank) and Berkshire Insurance Group. Berkshire offers a range of deposit, lending, insurance and wealth management products to retail, commercial, not-for-profit and municipal customers in its market areas. Berkshire product offerings also include retail and commercial electronic banking, commercial cash management and commercial interest rate swaps. The Bank’s loan portfolio consists of commercial loans, which include residential mortgages, commercial real estate, commercial and industrial loans, and consumer loans. The Bank’s securities available for sale include municipal bonds and obligations, mortgage-backed securities, other bonds and obligations, and marketable equity securities. As of December 5, 2016, the Bank had 99 full service branch offices in Massachusetts, New York, Connecticut, Vermont, New Jersey and Pennsylvania.

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