Education
About Us
Working with TipRanks
Follow Us
Flagstar Financial (FLG)
NYSE:FLG
Top Page
Flagstar Financial
(NYSE:FLG)
Rating:51Neutral
Price Target:―
Positive Factors
Loan Growth
Flagstar's 75 commercial banking hires since June 2024 have driven $1.046 billion of new or increased C&I loan commitments, resulting in $769 million of new originations.
Operational Improvements
The operational strategy focusing on credit stability, reducing costs, and national growth is surpassing expectations, leading to a positive EPS run-rate by the end of 2025.
Valuation
Flagstar Financial shares are seen as having a positive risk/reward skew due to a deeply discounted valuation and an improving operational outlook.
Negative Factors
Investor Sentiment
Investor sentiment remains negative with short interest around 13% due to concerns about capital and credit issues.
Net Interest Income
Flagstar reduced their net interest income guidance for 2025, partly driven by a miss in the first quarter.
Flagstar Financial (FLG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.18B
Dividend Yield0.48%
Average Volume (3M)6.65M
Price to Earnings (P/E)―
Beta (1Y)1.00
Revenue Growth-8.17%
EPS Growth73.59%
CountryUS
Employees6,993
SectorFinancial
Sector Strength82
IndustryBanks - Regional
Share Statistics
EPS (TTM)-0.26
Shares Outstanding415,079,900
10 Day Avg. Volume7,129,033
30 Day Avg. Volume6,653,815
Financial Highlights & Ratios
PEG Ratio-0.05
Price to Book (P/B)0.49
Price to Sales (P/S)0.00
P/FCF Ratio96.22
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$13.83Price Target Upside15.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Flagstar Financial Business Overview & Revenue Model
Company DescriptionFlagstar Financial, Inc. operates as the bank holding company for Flagstar Bank, N.A. that provides banking products and services in the United States. The company's deposit products include interest-bearing checking and money market, savings, non-interest-bearing, and retirement accounts, as well as certificates of deposit. Its loan products comprise multi-family loans; commercial real estate loans; acquisition, development, and construction loans; commercial and industrial loans; one-to-four family loans; specialty finance loans and leases; warehouse loans; and other loans, such as home equity lines of credit, boat and recreational vehicle indirect lending, point of sale consumer loans, and other consumer loans, including overdraft loans. The company offers cash management products; non-deposit investment and insurance products; and online banking, mobile banking, and bank-by-phone services. It primarily serves individuals, small and mid-size businesses, and professional associations. The company was formerly known as New York Community Bancorp, Inc. and changed its name to Flagstar Financial, Inc. in October 2024. Flagstar Financial, Inc. was founded in 1859 and is headquartered in Hicksville, New York.
How the Company Makes MoneyFlagstar Financial primarily generates revenue through interest income on loans and mortgages, as well as fees and service charges associated with its banking operations. The company earns a substantial portion of its income from the interest rate spread between what it charges borrowers and what it pays to depositors. Additionally, Flagstar Financial makes money through mortgage origination and servicing fees, where it acts as an intermediary in the home-buying process. Key partnerships with real estate companies and financial institutions enhance its market reach and contribute to its earnings. The company also benefits from cross-selling financial products to its existing customer base, further strengthening its revenue streams.
Flagstar Financial Financial Statement Overview
Summary
Flagstar Financial is facing financial challenges with declining revenues and profitability, as indicated by an income statement score of 32. However, the company shows resilience in cash flow management with a score of 58, and maintains a stable balance sheet with a score of 45, providing some liquidity cushion. Overall, the financial performance indicates a need for improvement in profitability and revenue generation.Income Statement
Flagstar Financial has experienced declining revenue and profitability in recent years. The company's gross profit margin remains steady at 100%, but it is operating at a net loss, with significant negative EBIT and EBITDA margins. Revenue decreased significantly from 2023 to 2024, indicating potential challenges in maintaining revenue streams.32
Negative
Balance Sheet
The balance sheet of Flagstar Financial shows high leverage with a debt-to-equity ratio that remains elevated. Stockholders' equity has remained relatively stable, but the equity ratio has decreased over time. The company has a substantial amount of cash and equivalents, which provides some liquidity buffer.45
Neutral
Cash Flow
Flagstar Financial's cash flow shows some resilience with positive operating and free cash flows, although they have decreased from the prior year. The company has managed to maintain positive free cash flow despite lower operating cash flow, indicating some efficiency in capital expenditure management.58
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.58B | 3.63B | 1.48B | 1.35B | 1.16B | Gross Profit |
| 2.58B | 3.63B | 1.48B | 1.35B | 1.16B | EBIT |
| -1.38B | -50.00M | 826.00M | 806.00M | 588.00M | EBITDA |
| -1.27B | 115.00M | 849.00M | 827.00M | 612.00M | Net Income Common Stockholders |
| -1.12B | -79.00M | 650.00M | 596.00M | 511.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 25.83B | 20.62B | 10.66B | 6.82B | 6.48B | Total Assets |
| 100.16B | 114.06B | 90.14B | 59.53B | 56.31B | Total Debt |
| 14.43B | 28.62B | 31.66B | 20.56B | 16.35B | Net Debt |
| -1.00B | 17.14B | 29.63B | 18.35B | 14.40B | Total Liabilities |
| 91.99B | 105.69B | 81.32B | 52.48B | 49.46B | Stockholders Equity |
| 8.17B | 8.37B | 8.82B | 7.04B | 6.84B |
| Cash Flow | Free Cash Flow | |||
| 50.00M | 197.00M | 1.02B | 286.00M | 334.00M | Operating Cash Flow |
| 86.00M | 263.00M | 1.03B | 290.00M | 334.00M | Investing Cash Flow |
| 15.45B | 20.67B | -6.32B | -2.76B | -1.02B | Financing Cash Flow |
| -11.59B | -11.41B | 5.17B | 2.73B | 1.90B |
Flagstar Financial Technical Analysis
Positive
11.96
Price Trends
11.58
Positive
11.23
Positive
11.04
Positive
Market Momentum
0.29
Positive
51.01
Neutral
54.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FLG, the sentiment is Positive. The current price of 11.96 is below the 20-day moving average (MA) of 12.08, above the 50-day MA of 11.58, and above the 200-day MA of 11.04, indicating a neutral trend. The MACD of 0.29 indicates Positive momentum. The RSI at 51.01 is Neutral, neither overbought nor oversold. The STOCH value of 54.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FLG.
Flagstar Financial Risk Analysis
Flagstar Financial disclosed 43 risk factors in its most recent earnings report. Flagstar Financial 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.
We are subject to credit risk in connection with our lending activities, and our financial condition and results of operations may be negatively impacted by economic conditions and other factors that adversely affect our borrowers. Q4, 2024
2.
Completing the diversification of the Company's loan portfolio may be more difficult, costly or time consuming than expected and the anticipated benefits and cost savings of the plan may not be realized. Q4, 2024
3.
The level of our commercial real estate loan portfolio may subject us to additional regulatory scrutiny. Q4, 2024
Flagstar Financial Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $5.26B | 7.59 | 12.85% | 3.58% | 13.85% | 2.43% | |
76 Outperform | $5.16B | 11.32 | 7.40% | 3.35% | 10.18% | 2.27% | |
73 Outperform | $4.83B | 22.76 | 6.63% | 3.11% | 8.10% | 6.95% | |
69 Neutral | $5.07B | 13.17 | 5.48% | 4.87% | 1.60% | -18.84% | |
67 Neutral | $5.20B | 10.45 | 9.73% | 5.82% | -0.21% | 1.69% | |
64 Neutral | $12.78B | 9.87 | 7.67% | 17015.06% | 12.34% | -5.99% | |
51 Neutral | $5.18B | ― | -10.40% | 0.48% | -8.17% | 73.59% |
* Financial Sector Average
Performance Comparison
FLG
Flagstar Financial
11.96
2.06
20.81%
OZK
Bank OZK
44.88
-1.24
-2.69%
COLB
Columbia Banking System
23.68
5.13
27.65%
FNB
F.N.B.
13.82
0.24
1.77%
GBCI
Glacier Bancorp
40.85
3.05
8.07%
VLY
Valley National Bancorp
8.63
1.37
18.87%
Flagstar Financial Earnings Call Summary
Earnings Call Date:Apr 25, 2025
(Q1-2025)
| % Change Since: 6.12%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Neutral
Flagstar Financial reported significant progress in reducing costs and expanding its C&I loan portfolio, with improved financial metrics and strengthened capital and liquidity. However, the bank continues to face challenges with ongoing net losses, the addition of significant non-accrual loans, and high costs associated with broker deposits.Q1-2025 Updates
Positive Updates
Improved Financial Performance
Flagstar Financial reported an adjusted net loss of $0.23 per diluted share, beating consensus estimates of $0.27, and improving from a $0.40 loss in the fourth quarter.
C&I Loan Growth
Commercial and Industrial (C&I) loan commitments exceeded $1 billion in the quarter with $769 million in originations, up over 40% from the previous quarter. The C&I pipeline stands at $870 million, more than double the figure from the fourth quarter.
Significant Cost Reductions
Noninterest expenses excluding one-time charges declined by $71 million quarter over quarter, with a target to reduce expenses by over $600 million year over year.
Strengthened Capital and Liquidity
The CET1 capital ratio remains strong at around 12%, and liquidity improved with a reduction in brokered deposits and FHLB advances.
CRE Portfolio Management
Net charge-offs and loan loss provisions decreased by almost 50% quarter over quarter, and the CRE portfolio has been actively managed to reduce concentration.
Negative Updates
Continued Net Loss
The first quarter still resulted in a net loss available to common shareholders of $0.26 per diluted share on a GAAP basis, indicating ongoing financial challenges.
Significant Non-Accrual Addition
A significant borrower moved to non-accrual status during the quarter, impacting earnings by approximately $33 million.
Legacy Portfolio Runoffs
Overall C&I loans declined due to runoff in legacy non-core portfolios, masking growth in new focus areas.
High Costs of Deposits
The bank is managing high costs of broker deposits and FHLB advances, with plans to reduce these further in 2025.
Company Guidance
During the Flagstar Financial, Inc. First Quarter 2025 Earnings Conference Call, CEO Joseph Otting provided guidance emphasizing the company's strategic initiatives and financial metrics. The adjusted net loss available to common shareholders was $0.23 per diluted share, compared to the consensus of $0.27. Otting highlighted a significant improvement in the C&I loan portfolio, with commitments of over $1 billion and $769 million in originations, marking a 40% increase from the previous quarter. The C&I pipeline stands at $870 million, more than double the prior quarter. A notable decline in net charge-offs and loan loss provisions, each down by almost 50% quarter-over-quarter, was also reported. CFO Lee Smith discussed their capital and liquidity strengths, including a CET1 capital ratio of approximately 12%. The company aims for a profitable fourth quarter in 2025, focusing on decreasing the cost of funds and expanding the C&I and private banking sectors. Additionally, strategic cost reductions led to $71 million in noninterest expense savings quarter-over-quarter, with a $600 million year-over-year target. The company plans to reduce broker deposits by $3 billion and FHLB advances by $1 billion over the next three quarters.Flagstar Financial Corporate Events
Business Operations and StrategyFinancial Disclosures
Flagstar Financial Reports Strong Q1 2025 Results
Positive
Apr 25, 2025
On April 25, 2025, Flagstar Financial announced its first quarter results, highlighting significant growth in credit commitments and loan originations, driven by strategic focus areas such as expanding product offerings and reducing operating expenses. The company is actively managing its commercial real estate portfolio and aims to improve its earnings profile by reducing costs and enhancing operational efficiencies, with over 80% of targeted efficiencies already realized.
Shareholder Meetings
Flagstar Financial Announces Virtual 2025 Shareholder Meeting
Neutral
Feb 24, 2025
On February 24, 2025, Flagstar Financial announced that its 2025 Annual Meeting of Shareholders will be held virtually on June 4, 2025. The meeting will be accessible via live webcast, with April 7, 2025, set as the record date for voting eligibility. This move to a virtual format reflects ongoing trends in shareholder engagement and may impact how stakeholders participate in the company’s governance processes.
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.