Education
About Us
Working with TipRanks
Follow Us
Bankunited (BKU)
NYSE:BKU
Top Page
BankUnited
(NYSE:BKU)
Rating:75Outperform
Price Target:―
Positive Factors
Company Potential
Management is optimistic about deposit concentrations reaching over 30%, improving the company's attractiveness as a potential consolidation candidate.
Earnings
BankUnited reported better than expected NIM expansion and lower provision drove an EPS beat.
Financial Performance
The company posted its most profitable quarter in nearly two years, with a notable return on assets and equity.
Negative Factors
Guidance and Forecasts
2024 guidance updates were net negative related to loans and expenses.
Loan Growth
Loan growth on a period end basis decreased 4% annualized Q/Q driven by declines in all loan categories excluding commercial real estate.
Loan Performance
Loan balances were negatively impacted by larger payoff activity in the C&I book, as M&A picked up.
BankUnited (BKU) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.70B
Dividend Yield3.29%
Average Volume (3M)951.96K
Price to Earnings (P/E)11.2
Beta (1Y)1.34
Revenue Growth-0.60%
EPS Growth39.49%
CountryUS
Employees1,662
SectorFinancial
Sector Strength81
IndustryBanks - Regional
Share Statistics
EPS (TTM)0.78
Shares Outstanding75,211,920
10 Day Avg. Volume876,247
30 Day Avg. Volume951,964
Financial Highlights & Ratios
PEG Ratio2.29
Price to Book (P/B)0.86
Price to Sales (P/S)0.00
P/FCF Ratio13.73
Enterprise Value/Market Cap0.78
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit1.37
Enterprise Value/Ebitda2.49
Forecast
1Y Price Target
$40.00Price Target Upside16.18% Upside
Rating ConsensusHold
Number of Analyst Covering8
BankUnited Business Overview & Revenue Model
Company DescriptionBankUnited, Inc. (BKU) is a bank holding company headquartered in Miami Lakes, Florida, primarily serving commercial and consumer customers. The company operates through its banking subsidiary, BankUnited, N.A., offering a wide range of financial products and services, including personal and business banking, commercial loans, real estate financing, and treasury management services. BankUnited focuses on providing high-quality banking solutions, leveraging its strong presence in the Florida market and its expansion in the New York metropolitan area.
How the Company Makes MoneyBankUnited generates revenue primarily through interest income from its loan portfolio, which includes commercial and industrial loans, real estate loans, and consumer loans. The company also earns money from interest on securities and other investments. Additionally, BankUnited derives non-interest income from various sources, such as service charges on deposit accounts, fees from treasury management services, and other financial service fees. The bank's profitability is influenced by factors like net interest margin, loan growth, asset quality, and the overall economic environment. Strategic partnerships and a focus on expanding its customer base in key geographic regions also contribute to its revenue growth.
BankUnited Financial Statement Overview
Summary
BankUnited demonstrates robust revenue growth and a healthy profit margin, with a strong capital structure marked by no debt in 2024. However, challenges include a decline in return on equity and stagnant free cash flow growth, indicating areas for improvement in operational efficiency and cash generation.Income Statement
BankUnited shows a strong gross profit margin consistently at 100%, which is typical for financial institutions where revenue equals gross profit. The net profit margin for 2024 is approximately 12.07%, a slight increase from the previous year. Revenue growth has been impressive, with a substantial increase of 120.49% from 2023 to 2024, indicating robust business expansion. However, the lack of EBITDA data limits a complete profitability analysis.85
Very Positive
Balance Sheet
The company maintains a solid equity position with an equity ratio of 7.99% in 2024, indicating a strong capital base. The debt-to-equity ratio is favorable at 0, showcasing low financial leverage and risk. However, the return on equity has decreased to 8.26% in 2024, down from 13.81% the previous year, suggesting declining efficiency in generating profits from shareholders' equity.70
Positive
Cash Flow
BankUnited's free cash flow remained stable, with no growth reported in 2024. The operating cash flow to net income ratio is 0.42, indicating moderate cash generation from operations relative to net income. The absence of growth in free cash flow presents concerns over cash generation potential despite positive cash flow metrics.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.01B | 873.03M | 990.60M | 929.84M | 884.98M | Gross Profit |
| 1.01B | 873.03M | 990.60M | 929.84M | 884.98M | EBIT |
| 316.35M | 237.08M | 711.88M | 449.38M | 249.36M | EBITDA |
| 0.00 | 0.00 | 452.75M | 527.88M | 321.87M | Net Income Common Stockholders |
| 232.47M | 178.67M | 284.97M | 414.98M | 197.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 9.62B | 588.28M | 572.65M | 314.86M | 397.72M | Total Assets |
| 35.24B | 35.76B | 37.03B | 35.82B | 35.01B | Total Debt |
| 3.64B | 5.82B | 6.14B | 2.63B | 3.85B | Net Debt |
| 3.15B | 5.24B | 5.57B | 2.31B | 3.45B | Total Liabilities |
| 32.43B | 33.18B | 34.59B | 2.63B | 3.85B | Stockholders Equity |
| 2.81B | 2.58B | 2.44B | 3.04B | 2.98B |
| Cash Flow | Free Cash Flow | |||
| 433.78M | 657.50M | 1.24B | 1.18B | 844.57M | Operating Cash Flow |
| 433.78M | 657.50M | 1.29B | 1.22B | 864.17M | Investing Cash Flow |
| 409.71M | 980.57M | -2.12B | -1.64B | -2.62B | Financing Cash Flow |
| -940.66M | -1.62B | 1.08B | 334.87M | 1.94B |
BankUnited Technical Analysis
Negative
34.43
Price Trends
33.28
Positive
35.68
Negative
36.27
Negative
Market Momentum
0.68
Positive
51.30
Neutral
39.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKU, the sentiment is Negative. The current price of 34.43 is above the 20-day moving average (MA) of 34.42, above the 50-day MA of 33.28, and below the 200-day MA of 36.27, indicating a neutral trend. The MACD of 0.68 indicates Positive momentum. The RSI at 51.30 is Neutral, neither overbought nor oversold. The STOCH value of 39.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BKU.
BankUnited Risk Analysis
BankUnited disclosed 44 risk factors in its most recent earnings report. BankUnited reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
The actual or perceived financial stability of other financial institutions and in particular other regional and mid-size banks could adversely affect our business, market valuation and results of operations. Q4, 2024
2.
We may need to raise additional capital in the future, and such capital may not be available when needed or at all. Q4, 2024
3.
The risk inherent in the adoption and implementation of new technologies, or the failure to keep pace with technological innovation may result in reputational harm, increased regulatory scrutiny, increased liability, heightened operational risk, an adverse impact on our ability to compete for loans and deposits and serve our customers, and an adverse impact on our business, financial condition and results of operations. Q4, 2024
BankUnited Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $2.70B | 11.16 | 8.63% | 3.29% | -0.60% | 39.49% | |
75 Outperform | $2.28B | 11.03 | 9.16% | 3.57% | 1.42% | 2.77% | |
75 Outperform | $2.75B | 17.43 | 12.98% | 2.50% | 11.81% | 23.34% | |
73 Outperform | $2.38B | 10.36 | 9.58% | 3.82% | 8.05% | -3.31% | |
71 Outperform | $2.65B | 14.94 | 8.36% | 2.83% | 6.93% | 17.97% | |
64 Neutral | $12.66B | 9.81 | 7.67% | 17015.07% | 12.33% | -5.97% | |
58 Neutral | $2.48B | 16.97 | 4.20% | 5.56% | 2.90% | -12.63% |
* Financial Sector Average
Performance Comparison
BKU
BankUnited
34.43
7.22
26.53%
FFBC
First Financial Bancorp
24.11
2.36
10.85%
FRME
First Merchants
37.64
5.64
17.63%
PRK
Park National
162.74
30.55
23.11%
SFNC
Simmons 1st Nat'l
18.89
2.10
12.51%
TOWN
TowneBank
34.24
8.12
31.09%
BankUnited Earnings Call Summary
Earnings Call Date:Apr 28, 2025
(Q1-2025)
| % Change Since: 2.38%|
Next Earnings Date:Jul 17, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a solid quarter with several positive outcomes such as exceeding net income expectations, successful system conversion, and strong deposit growth. However, challenges such as margin compression, a decline in the loan portfolio, and an uncertain economic environment present areas of concern.Q1-2025 Updates
Positive Updates
Net Income Exceeds Expectations
Net income for the quarter was $58.5 million or $0.78 per share, slightly better than the consensus of $0.76.
Successful GL System Conversion
The company successfully completed a General Ledger conversion without any issues, leading to improved operational efficiency.
Decrease in Cost of Deposits
Cost of deposits decreased by 14 basis points to 2.58% from 2.72% last quarter.
Strong Deposit Growth
Total deposit growth, excluding brokered deposits, was $719 million for the quarter.
Stable Credit Quality
The provision for credit losses was $15 million with an ACL-to-loans ratio remaining unchanged at 92 basis points.
Dividend Increase
The company increased its dividend by a couple of pennies, continuing a trend of steady dividend growth.
Negative Updates
Slight Margin Compression
Net interest margin declined by 3 basis points to 2.81% from 2.84% last quarter.
Loan Portfolio Decline
Total loans were down $300 million, with a $100 million decline in the core commercial book.
Uncertain Economic Environment
The macro environment remains uncertain, with a widening 'cone of uncertainty' due to interest rate volatility and economic conditions.
Increase in Non-Performing Loans
Net charge-offs for the quarter amounted to $19.4 million, or 33 basis points annualized.
Company Guidance
In the BankUnited First Quarter 2025 earnings call, the company reported a net income of $58.5 million, or $0.78 per share, slightly surpassing the consensus estimate of $0.76. The net interest margin decreased by 3 basis points to 2.81%, primarily due to rolling off some hedges, but this was in line with expectations. The cost of deposits decreased by 14 basis points to 2.58%, and interest-bearing deposits saw a 21 basis point reduction to 3.54%. Total deposits, excluding brokered, grew by $719 million, while the loan-to-deposit ratio stood at 85.5%. The CET1 ratio increased to 12.2%, and the tangible book value per share rose to $37.48. The bank maintained its guidance from the previous quarter, despite acknowledging a wider "cone of uncertainty" due to an unstable economic environment and fluctuating interest rates.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.