We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
First Republic (FRC) to Raise $390M With Common Stock Offering
Read MoreHide Full Article
Shares of First Republic Bank declined 2.7% after the company priced an underwritten public offering of 2 million shares of its common stock. With the offering, the company expects to raise gross proceeds of $390.3 million, excluding underwriting discounts and commissions as well as anticipated offering expenses.
The company has also offered the underwriters a 30-day option to purchase up to another 300,000 shares. It plans to use the net proceeds from the offering for general corporate purposes, including the funding of loans or buying investment securities for its portfolio.
Subject to customary closing norms, the offering is expected to close on or about Aug 12, 2021.
While the share offering will preserve the company’s liquidity, it is expected to result in earnings per share dilution in the near term. As of the second-quarter end, its cash and cash equivalents, and due from banks were $7.9 billion. Time-interest-earned ratio of 7.5 has increased steadily over the past few quarters. Thus, given the favorable factors and record of consistent earnings growth, First Republic’s liquidity position seems decent enough to counter any worsening of the economic situation.
The company’s balance-sheet growth story also remains impressive. It recorded notable growth in loan balances, driven by increased loan origination volumes with a three-year CAGR (2018-2020) of 29.4%. Loan growth continued to improve in the first six months of 2021.
Given the improving U.S. economy, nationwide reopening and recovery in consumer sentiment; the lending scenario is likely to be decent in the upcoming quarters. Hence, efforts to procure capital will further bolster loan-growth prospects for the company.
Shares of this Zacks Rank #3 (Hold) company have gained 7.8% over the past three months compared with the industry’s rally of 3.2%.
Recently, SVB Financial Group priced its underwritten public offering of 2,227,000 shares of common stock at $564 per share for anticipated gross proceeds of $1.25 billion before underwriting discounts and commissions as well as offering expenses.
Recently, W. P. Carey Inc. (WPC - Free Report) started a public offering of 4.5 million shares of common stock, which will be offered on a forward basis through forward sale agreements.
In late July, National Storage Affiliates Trust (NSA - Free Report) closed its previously announced underwritten public offering of 10,120,000 common shares, with the company receiving $497.4 million in net proceeds from the offering after deducting underwriting discount and projected offering expenses.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Shutterstock
First Republic (FRC) to Raise $390M With Common Stock Offering
Shares of First Republic Bank declined 2.7% after the company priced an underwritten public offering of 2 million shares of its common stock. With the offering, the company expects to raise gross proceeds of $390.3 million, excluding underwriting discounts and commissions as well as anticipated offering expenses.
The company has also offered the underwriters a 30-day option to purchase up to another 300,000 shares. It plans to use the net proceeds from the offering for general corporate purposes, including the funding of loans or buying investment securities for its portfolio.
Subject to customary closing norms, the offering is expected to close on or about Aug 12, 2021.
While the share offering will preserve the company’s liquidity, it is expected to result in earnings per share dilution in the near term. As of the second-quarter end, its cash and cash equivalents, and due from banks were $7.9 billion. Time-interest-earned ratio of 7.5 has increased steadily over the past few quarters. Thus, given the favorable factors and record of consistent earnings growth, First Republic’s liquidity position seems decent enough to counter any worsening of the economic situation.
The company’s balance-sheet growth story also remains impressive. It recorded notable growth in loan balances, driven by increased loan origination volumes with a three-year CAGR (2018-2020) of 29.4%. Loan growth continued to improve in the first six months of 2021.
Given the improving U.S. economy, nationwide reopening and recovery in consumer sentiment; the lending scenario is likely to be decent in the upcoming quarters. Hence, efforts to procure capital will further bolster loan-growth prospects for the company.
Shares of this Zacks Rank #3 (Hold) company have gained 7.8% over the past three months compared with the industry’s rally of 3.2%.
Image Source: Zacks Investment Research
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stock Offering by Other Finance Companies
Recently, SVB Financial Group priced its underwritten public offering of 2,227,000 shares of common stock at $564 per share for anticipated gross proceeds of $1.25 billion before underwriting discounts and commissions as well as offering expenses.
Recently, W. P. Carey Inc. (WPC - Free Report) started a public offering of 4.5 million shares of common stock, which will be offered on a forward basis through forward sale agreements.
In late July, National Storage Affiliates Trust (NSA - Free Report) closed its previously announced underwritten public offering of 10,120,000 common shares, with the company receiving $497.4 million in net proceeds from the offering after deducting underwriting discount and projected offering expenses.