Discounted Cash Flow Calculation for DSE:MTB using Excess Returns Model Model
The calculations below outline how an intrinsic value for Mutual Trust Bank is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.
In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.
The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.
The current share price of
Mutual Trust Bank
is above its future cash flow value.
Often investors are willing to pay a
for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
Mutual Trust Bank's
is considered below, and whether this is a fair price.
Price based on past earnings
Mutual Trust Bank's earnings available for a low price, and how does
this compare to other companies in the same industry?
In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Mutual Trust Bank has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.
This is quite a rare situation as 97% of companies covered by Simply Wall St do have past financial data. You can see them here.
Show me the analysis anyway
The future performance of a company is measured in the same way as past
performance, by looking at estimated
and how much profit it is expected to make.
Future estimates come from
professional analysts. Just like forecasting the weather, they don’t always get
Expected Banks industry annual growth in earnings.
Earnings growth vs Low Risk Savings
Mutual Trust Bank
expected to grow at an
Unable to compare Mutual Trust Bank's earnings growth to the low risk savings rate as no estimate data is available.
Growth vs Market Checks
Unable to compare Mutual Trust Bank's earnings growth to the Bangladesh market average as no estimate data is available.
Unable to compare Mutual Trust Bank's revenue growth to the Bangladesh market average as no estimate data is available.
Unable to determine if Mutual Trust Bank is high growth as no earnings estimate data is available.
Unable to determine if Mutual Trust Bank is high growth as no revenue estimate data is available.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Mutual Trust Bank's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
Mutual Trust Bank
has a total score of
1/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Fundamentally a bank's business is based upon borrowing and lending money, for
this reason they typically have high levels of debt and we analyse them
This treemap shows a more detailed breakdown of
Mutual Trust Bank's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Mr. Syed Mahbubur Rahman serves as Managing Director and Chief Executive Officer at Mutual Trust Bank Ltd. Since December 01, 2019 and has been its Executive Director since December 01, 2019. Mr. Rahman served as the Chief Executive Officer and Managing Director at Dhaka Bank Limited since November 8, 2015 until November 2019 and served as its Director since September 2, 2016 until November 2018. Mr. Rahman served as a Senior Vice President at Social Islami Bank Limited and served as its Senior Assistant Vice President. Mr. Rahman served as the Chief Executive Officer and Managing Director of BRAC Bank Limited since June 2010. He joined BRAC Bank in 2008 and served as its Deputy Managing Director of BRAC Bank Limited since November 2008. He has experience in Banking Services and Credit related arena. During his banking career, he attended numerous trainings, seminars and workshops on different aspects of banking held in the country and abroad. He served Deputy Managing Director at Prime Bank Limited. He worked in various roles at Citibank NA, Standard Chartered Bank, ANZ Grindlays Bank, IDLC Finance Limited. He started his career in Saudi Bangladesh Agricultural and Industrial Investment Co. (SABINCO). He served as a Director of bKash Ltd and Industrial and Infrastructure Development Finance Company Limited. He served as a Director at BRAC EPL Investments Ltd, BRAC EPL Stock Brokerage Ltd, BRAC Saajan Exchange Ltd, BRAC IT Services Ltd and IIDFC Securities Ltd. He served as a Director of BRAC Bank Limited since March 31, 2011. Under his dynamic leadership as the Chief Executive Officer of BRAC Bank, he received various accolades from some of the prestigious institutions namely, Financial Times, Finance Asia, The Asian Banker, etc. His charismatic role in launching one of the fastest growing mobile platforms namely, bKash was very instrumental. He was also accorded with the prestigious 'The Asian Banker Leadership Achievement Award' for Bangladesh for the period 2011-2013. Mr. Rahman is a Member of the Board of Governors at Association of Bankers, Bangladesh Limited (ABBD). Mr. Rahman holds MBA from Institute of Business Administration of Dhaka University.
Insufficient data for Syed to compare compensation growth.
Insufficient data for Syed to establish whether their remuneration is reasonable compared to companies of similar size in Bangladesh.
Management Team Tenure
Average tenure of the
Mutual Trust Bank
management team in years:
The average tenure for the Mutual Trust Bank management team is less than 2 years, this suggests a new team.
MD, CEO & Executive Director
Senior EVP & Group CFO
Md. Shah Patwary
Group Chief Information Officer & Senior EVP
Group Head of Internal Control & Compliance and Deputy MD
Executive VP & Group Head of Human Resources
Senior EVP & Head of MITS
Senior EVP & Head of MTB Dhaka Division Branches
Senior EVP & Head of CRM
Senior Vice President
Board of Directors Tenure
Average tenure and age of the
Mutual Trust Bank
board of directors in years:
The average tenure for the Mutual Trust Bank board of directors is less than 3 years, this suggests a new board.
Board of Directors
Chairman of the Board
MD, CEO & Executive Director
Who owns this company?
Recent Insider Trading
No 3 month open market individual insider trading information.
Mutual Trust Bank Limited provides various commercial banking and related services in Bangladesh. The company offers retail banking services, including deposit products, such as savings and current accounts, and fixed deposits; personal, auto, home, home equity, and professional’s loan products; overdraft facilities; credit cards; and locker services. It also provides wholesale banking services comprising term finance, such as project finance, finance for importing capital machinery, lease finance, and house building finance; working capital finance comprising secured over drafts, cash credits, cash against documents, short term loans, and inland and foreign bill purchases; and syndications and structured finance consisting of infrastructure, aircraft, manufacturing project, agro-based project, and micro financing. In addition, the company offers trade finance, including export finance, such as L/C opening, export bill discounting, and secured overdrafts; import finance consisting of loan against trust receipts and term loans; and non-funded trade finance. Further, it provides off-shore banking services, SME banking, and NRB banking products and services; treasury services, such as money market, DIBOR, foreign exchange, and primary dealers services; and cash management, securities and custody, remittance, and agent banking, as well as SMS and Internet banking services. The company operates 114 branches, 100 agent banking centers, 268 automated teller machines, and 3,140 point of sale machines. Mutual Trust Bank Limited was incorporated in 1999 and is headquartered in Dhaka, Bangladesh.
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