Banc of California (BANC) AI Stock Analysis

• Market Cap: $2.67B
• Dividend Yield: 2.39%
• Average Volume (3M): 2.23M
• Price to Earnings (P/E): 25.9
• Beta (1Y): 1.27
• Revenue Growth: 49.10%
• EPS Growth: N/A
• Country: US
• Employees: 1,903
• Sector: Financial
• Sector Strength: 76
• Industry: Banks - Regional
• EPS (TTM): 0.12
• Shares Outstanding: 147,301,060
• 10 Day Avg. Volume: 1,998,932
• 30 Day Avg. Volume: 2,226,582
• PEG Ratio: -0.20
• Price to Book (P/B): 0.74
• Price to Sales (P/S): 1.39
• P/FCF Ratio: 40.48
• Enterprise Value/Market Cap: 2.01
• Enterprise Value/Revenue: 2.98
• Enterprise Value/Gross Profit: 5.66
• Enterprise Value/Ebitda: 16.97
• 1Y Price Target: $18.17
• Price Target Upside: 8.41% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 71 Outperform
• Price Target: $18.00 ▲(7.40% Upside)

Banc of California's strong earnings call performance and positive technical indicators are the most significant factors driving the score. Financial performance shows recovery but is tempered by valuation concerns, with the stock appearing relatively expensive.

Positive Factors

Earnings

Management characterized its expense guide as 'very conservative,' expecting to likely be in the low end, potentially driving EPS upside.

Management Actions

Management has been actively repurchasing shares, taking advantage of the recent pullback.

Share Value

Shares are trading at 84% of tangible book value, indicating potential value for investors.

Negative Factors

Credit Concerns

Credit concerns were noted due to negative risk migration and an increase in classified loans by 35%.

Loan and Provision Uncertainty

The transfer of $507MM construction and CRE loans to held-for-sale resulted in elevated NCOs and provisions, introducing some level of uncertainty.

Revenue Performance

Expect shares to be weaker on revenue miss and credit noise.

Banc of California Business Overview & Revenue Model

Company Description

Banc of California (BANC) is a financial institution headquartered in Santa Ana, California, primarily serving the needs of businesses and individuals throughout the state. The bank operates in the commercial banking sector, offering a wide range of financial products and services, including commercial and residential lending, treasury management, private banking, and mortgage services. Banc of California is focused on providing tailored financial solutions to clients in various industries, including real estate, healthcare, and technology.

How the Company Makes Money

Banc of California generates revenue primarily through interest income from loans and fees associated with its financial services. The bank earns interest income by providing various types of loans, such as commercial real estate loans, construction loans, and consumer loans, which are typically repaid with interest over time. Additionally, Banc of California collects fees from services such as treasury management, merchant services, and investment advisory. The bank may also generate non-interest income through its mortgage origination and servicing operations. Strategic partnerships with real estate developers and other businesses help to enhance its lending activities and expand its client base, contributing further to its earnings.

Banc of California Financial Statement Overview

Summary

Banc of California's financials show a recovery with improved profitability margins and cash flow generation. Despite a recent revenue decline, operational efficiency has rebounded, and the balance sheet remains solid with controlled leverage.

Income Statement

Banc of California shows a mixed performance on its income statement. The TTM (Trailing-Twelve-Months) gross profit margin stands at approximately 52.6%, indicating a strong ability to cover costs, although it has decreased compared to previous years. The net profit margin has improved to 8.3% after a challenging period in 2023, reflecting better operational efficiency. Revenue growth rate between 2024 and the TTM period is negative at -3.7%, indicating a recent decline in revenue. EBIT and EBITDA margins are positive, showcasing operational profitability recovery, yet they remain below historical highs.

Balance Sheet

The balance sheet of Banc of California presents a stable financial position with a debt-to-equity ratio of 0.74, which indicates a moderate level of leverage. The return on equity (ROE) for the TTM period is 4.2%, demonstrating modest equity returns compared to historical highs. The equity ratio is 10.4%, suggesting a conservative capital structure. While equity has grown, total assets have slightly decreased, reflecting strategic asset management.

Cash Flow

The cash flow statement shows a solid free cash flow growth rate of 166.5% in the TTM period, highlighting improved cash generation capabilities. However, the operating cash flow to net income ratio is 1.21, indicating that cash generation aligns closely with net income. The free cash flow to net income ratio is 1.15, showing adequate cash conversion. Despite recent improvements, historical fluctuations in cash flow stability warrant cautious optimism.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.80B	1.87B	1.50B	1.61B	1.34B	309.48M
Gross Profit	948.45M	943.09M	226.38M	1.32B	1.44B	214.44M
EBITDA	316.32M	290.06M	-2.12B	664.97M	917.67M	32.18M
Net Income	149.60M	126.89M	-1.90B	423.61M	606.96M	12.57M
Balance Sheet
Total Assets	33.78B	33.54B	38.53B	41.23B	9.43B	7.91B
Cash, Cash Equivalents and Short-Term Investments	2.34B	4.75B	7.72B	7.08B	1.54B	1.45B
Total Debt	2.62B	2.33B	3.85B	2.63B	816.12M	816.76M
Total Liabilities	30.26B	30.04B	35.14B	37.28B	8.36B	6.98B
Stockholders Equity	3.52B	3.50B	3.39B	3.95B	1.07B	897.21M
Cash Flow
Free Cash Flow	171.38M	64.33M	120.55M	581.11M	454.91M	69.77M
Operating Cash Flow	180.89M	77.37M	135.77M	701.97M	502.96M	74.86M
Investing Cash Flow	1.40B	1.89B	12.61B	-3.57B	-5.71B	-266.92M
Financing Cash Flow	-2.32B	-4.84B	-9.61B	1.05B	6.11B	39.40M

Banc of California Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.76
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BANC, the sentiment is Positive. The current price of 16.76 is above the 20-day moving average (MA) of 15.79, above the 50-day MA of 15.10, and above the 200-day MA of 14.76, indicating a bullish trend. The MACD of 0.55 indicates Negative momentum. The RSI at 69.58 is Neutral, neither overbought nor oversold. The STOCH value of 81.43 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BANC.

Banc of California Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PFS	80 Outperform	$2.59B	11.19	8.78%	4.84%	66.96%	67.27%
WAFD	79 Outperform	$2.48B	12.02	7.59%	3.41%	8.75%	5.16%
FFBC	77 Outperform	$2.54B	10.53	9.77%	3.70%	4.62%	2.69%
BKU	72 Outperform	$2.95B	11.37	8.98%	3.10%	-2.80%	51.85%
BANC	71 Outperform	$2.67B	25.87	4.32%	2.39%	49.10%	―
FRME	69 Neutral	$2.38B	10.71	9.90%	3.42%	-1.18%	23.43%
Sector *	68 Neutral	$17.79B	11.64	10.28%	3.76%	9.64%	1.17%

Banc of California Corporate Events

Banc of California Reports Strong Q2 2025 Results

Banc of California reported its second quarter results for 2025, highlighting a 9% annualized loan growth and net earnings of $18.4 million. The company also achieved a 3% increase in total revenue and a 6% rise in pre-tax pre-provision income from the previous quarter. The bank’s strategic repositioning through loan sales improved its credit profile, while maintaining strong capital ratios and increasing book value per share. The results reflect the company’s robust growth trajectory and market share expansion in key verticals, positioning it for continued profitability and shareholder value.