Being a financial holding company, Trust Financial Corporation operates through Trust Bank and non-bank subsidiaries.
It offers a wide range of banking services to consumer and commercial clients, including auto lending, bank card lending, asset management, investment brokerage services, payment solutions, private equity investments and more.
The company’s services also include trade finance, government finance, investment banking, and capital markets services. Trust Financial Corporation operates in three segments; Insurance holdings, corporate banking, commercial banking, retail and wealth banking.
As it turns out, Trust Financial Corporation has a wide reach in the field of finance. But does that make Trust stock a good investment? Find more details below.
The current share price of Trust Financial Corporation
Trueist stock is currently trading at $58.67 and has a market capitalization of $78.318 billion as of December 30, 2021. The stock is expected to reach a target of $67.62 in a year.
Is Trust Stock a good investment?
To determine whether or not a stock is a good investment, investors usually look at financial ratios. Below is a detailed look at the financial ratios for the Trust stock.
The P/E ratio – the ratio of short-term price-to-earnings – is a key metric that investors use to determine if a stock is worth an investment. The price-to-earnings ratio is defined as the amount investors are willing to pay for each dollar of earnings in stocks.
Since it gives a sense of the popularity of stocks and the interest of investors, it is one of the most widely used financial ratios for investing. Investors can use the P/E ratio to compare a stock to:
- her previous performance
- The average PE ratio in the respective industry
- Average price-earnings ratio in the market as a whole
Truist has a P/E ratio of 13.87. This number is comparable to the average P/E ratio in the market and shows that the stock is sufficiently valued by investors.
P/S . ratio
The price-to-sales ratio, or price-sales ratio, compares a stock’s price to its sales. The lower the better. Some people prefer price-to-price ratio over other metrics because it is not easy to manipulate it by cheating accounting tricks.
However, it is important to keep in mind that the P/S ratio is a good metric when judging a stock from a relative point of view with similar companies since different sectors have different ranges of the P/S ratio.
Trueist stock has a P/S ratio of 3.562, which is lower or comparable to most other stocks in the same industry. For example, JPMorgan Chase has a P/S ratio of 3.991 while Bank of America Corp has a P/S ratio of 4,430.
In terms of competition, Wells Fargo has the best P/S ratio of 2,713.
The value score also helps determine if a stock is worth the investment. Investors should consider stock valuation because investing is about buying low and selling high. Buying stocks that are going up means buying stocks that were initially undervalued.
The investor grades an A+ by AAII’s value grade. The result is the average of the following percentiles: price-to-value-added ratio, shareholder return, price-to-book-value-ratio, price-earnings-ratio, enterprise value-to-earnings-be-tax-amortization-also known as EV/EBITDA-and price-to-earnings-ratio Free cash flow or P/CF.
Shares in the range of 0-20 are considered deep values, while those in the range of 21-40 are considered good values. Since Trust Financial Corp has 33 value scores, they fall into the value category.
Judging from these financial ratios, Trust stock seems like a good investment.
Should you invest in real stocks?
You should invest in Trust stocks if you are the type of investor who depends on dividends to grow your wealth. The company last received a dividend on November 9, 2021. The dividend date is important to investors because buying shares after this date means late settlement. Thus, it will not appear in the registration history.
The company paid a dividend to investors on December 1, 2021, to those who bought the stock before November 10.
The next dividend payment to Trust Financial Corporation will be $0.48 per share. In 2020, the company gave $1.92 to its shareholders.
What the next 12 months hold
If you take a look at the last 12 months of the dividend, you’ll notice that the company has a 3.0% ex post return on its current share price.
When investing in such companies, investors should know that dividends come from the company’s earnings. If the company is paying more in dividends than it makes in profits, the investment may be unsustainable.
Since Trust Financial Corporation pays 43% of its earnings as dividend, investors can consider the stock sustainable. Besides this, another thing that makes Trust Financial Corporation stock an attractive option is the continued growth of the company.
The company is growing rapidly and reinvesting most of its profits back into the business. It is a reliable investment mix as it creates sustainable financial value for future investors.
Hedge Fund Benefit from Trust Stock
Recently, Trust Financial Corporations have seen a drop in interest on hedge funds. At the end of the third quarter of 2021, the stock was in 34 hedge fund portfolios. Trust Financial Corporation has noticed a drop in interest from all hedge funds tracked by Yahoo Finance, which means the stock underperformed in this regard.
Take the final
Trust Financial Corporation stock is trading at an attractive price at the moment and has seen a significant increase in price since the last market closed. Therefore, investors can consider investing in Trust stocks.
But if you are a hedge fund investor, this stock is not for you because the trust stock has seen a drop in interest for the stakeholder hedge funds.
good to know
Financial ratios can be useful in regularly examining a stock’s potential and success relative to its past performance and current performance of other stocks in the same industry. According to Forbes, ratios such as P/E, P/S, and PEG are very useful for finding the financial health of a company before investing in its stock. But make sure that you don’t just think about financial ratios because company news and annual income reports also affect a stock’s success.
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