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The Bank of N.T. Butterfield & Son (NYSE:NTB)

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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The Bank of N.T. Butterfield & Son stock research in summary

investors.butterfieldgroup.com

ANALYSIS: With an Obermatt Combined Rank of 33 (worse than 67% compared with investment alternatives), The Bank of N.T. Butterfield & Son (Diversified Banks, Bermuda) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of The Bank of N.T. Butterfield & Son are low in value (priced high) with a consolidated Value Rank of 25 (worse than 75% of alternatives) and show below-average growth (Growth Rank of 11) but are safely financed (Safety Rank of 99), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 33, is a hold recommendation based on The Bank of N.T. Butterfield & Son's financial characteristics. As the company The Bank of N.T. Butterfield & Son's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 25) and low growth (Obermatt Growth Rank of 11), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 99) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	25
Growth Rank	11
Safety Rank	99
Combined Rank	33

Country	Bermuda
Industry	Diversified Banks
Index	Independent Boards Growth Markets
Size class	Medium

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: The Bank of N.T. Butterfield & Son

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	31	25	33	25
GROWTH
GROWTH	19	11	3	11
SAFETY
SAFETY	57	100	100	99
SENTIMENT
SENTIMENT	n/a	29	63	^new
360° VIEW
360° VIEW	n/a	25	51	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better The Bank of N.T. Butterfield & Son is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	31	25	33	25
GROWTH
GROWTH	19	11	3	11
SAFETY
SAFETY	57	100	100	99
COMBINED
COMBINED	28	37	41	33

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of The Bank of N.T. Butterfield & Son the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 25 (worse than 75% compared with alternatives), The Bank of N.T. Butterfield & Son shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with all four indicators below average for The Bank of N.T. Butterfield & Son. Price-to-Sales is 24 which means that the stock price compared with what market professionals expect for future profits is higher than 76% of comparable companies, indicating a low value concerning The Bank of N.T. Butterfield & Son's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 22, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of The Bank of N.T. Butterfield & Son. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 27 and Dividend Yield, which is lower than 51% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 25, is a hold recommendation based on The Bank of N.T. Butterfield & Son's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for The Bank of N.T. Butterfield & Son? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as The Bank of N.T. Butterfield & Son? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. The Bank of N.T. Butterfield & Son may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	21	19	31	24
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	19	22	39	27
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	12	15	20	22
DIVIDEND YIELD
DIVIDEND YIELD	74	68	59	49
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	31	25	33	25

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of The Bank of N.T. Butterfield & Son; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), The Bank of N.T. Butterfield & Son shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for The Bank of N.T. Butterfield & Son. Capital Growth has a rank of 67, which means that currently professionals expect the company to grow its invested capital more than 10% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 57 (above 57% of alternative investments). But Sales Growth has only a rank of 1, which means that, currently, professionals expect the company to grow less than 99% of its competitors, and Profit Growth is also low at a rank of 10. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 11, is a sell recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for The Bank of N.T. Butterfield & Son, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	6	14	4	1
PROFIT GROWTH
PROFIT GROWTH	n/a	18	28	10
CAPITAL GROWTH
CAPITAL GROWTH	n/a	33	7	67
STOCK RETURNS
STOCK RETURNS	78	65	61	57
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	19	11	3	11

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of The Bank of N.T. Butterfield & Son.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 99 (better than 99% compared with alternatives) for 2024, the company The Bank of N.T. Butterfield & Son has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of The Bank of N.T. Butterfield & Son is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for The Bank of N.T. Butterfield & Son. Leverage is at 96, meaning the company has a below-average debt-to-equity ratio. It has less debt than 96% of its competitors. Refinancing is at a rank of 59, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 59% of its competitors. Finally, Liquidity is also good at a rank of 89, which means that the company generates more profit to service its debt than 89% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 99 (better than 99% compared with alternatives), The Bank of N.T. Butterfield & Son has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with The Bank of N.T. Butterfield & Son but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	82	90	96	96
REFINANCING
REFINANCING	8	67	78	59
LIQUIDITY
LIQUIDITY	62	100	98	89
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	57	100	100	99

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of The Bank of N.T. Butterfield & Son and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	56	58	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	7	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	67	85	^new
MARKET PULSE
MARKET PULSE	n/a	48	30	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	29	63	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for The Bank of N.T. Butterfield & Son.
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