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PNC Financial Services Group Inc PNC

Morningstar Rating
$147.81 +0.61 (0.41%)
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Company Report

NYCB Was Uniquely Risky; We Would Not Read Too Much Into the Entire Banking Sector

Our thesis on the U.S. banks following the Silicon Bank fallout was that all of the banks we covered, except for First Republic (which we downgraded to a $3 fair value estimate on March 20, 2023, and a $0 fair value on April 27, 2023), would be able to weather the storm. We believed that banks in trouble were in uniquely risky positions. We believe this thesis has largely held up, and sorting through banks based on their unique risk profiles remains necessary and valuable. To the extent that the market is selling off all banks because of what has happened to NYCB, we think there could be opportunities once again while acknowledging the significant time horizon risk (how long does it take for the banks to prove to the market they are fine) and the choppy waters that could occur in the meantime (we expect more commercial real estate related loan losses in the future).

Price vs Fair Value

PNC is trading at a 16% discount.
Price
$147.81
Fair Value
$865.00
Uncertainty
Medium
1-Star Price
$748.74
5-Star Price
$574.50
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

PNC's acquisition of BBVA seems likely to add value to the franchise and for shareholders, and will make PNC one of the regional banks with the most scale, and could drive above-market fee growth for several years.

Bears

There are few positive catalysts left for the banks. Funding costs are running higher, net interest income has likely peaked, higher regulatory scrutiny is likely, and a potential recession may be around the corner.

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News

Trading Information

Previous Close Price
$147.20
Day Range
$145.28148.16
52-Week Range
$109.40157.69
Bid/Ask
$146.55 / $147.81
Market Cap
$58.80 Bil
Volume/Avg
1.8 Mil / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
10.48
Price/Sales
2.76
Dividend Yield (Trailing)
4.16%
Dividend Yield (Forward)
4.16%
Total Yield
5.15%

Company Profile

PNC Financial Services Group is a diversified financial services company offering retail banking, corporate and institutional banking, asset management, and residential mortgage banking across the United States.
Sector
Financial Services
Industry
Banks - Regional
Stock Style Box
Large Value
Total Number of Employees
56,411

Competitors

Valuation

Metric
PNC
FITB
KEY
Price/Earnings (Normalized)
10.489.5212.78
Price/Book Value
1.311.371.09
Price/Sales
2.762.772.13
Price/Cash Flow
7.555.704.12
Price/Earnings
PNC
FITB
KEY

Financial Strength

Metric
PNC
FITB
KEY
Quick Ratio
Current Ratio
Interest Coverage
Quick Ratio
No chart available

Profitability

Metric
PNC
FITB
KEY
Return on Assets (Normalized)
1.13%1.26%0.92%
Return on Equity (Normalized)
14.50%16.87%15.45%
Return on Invested Capital (Normalized)
Return on Assets
PNC
FITB
KEY
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Economic Moat
Market Cap
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ISNPY
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MFG
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TFC
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LYG
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BBD
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DB
Deutsche Bank AGWpyx$27.3 Bil

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