Attractive P/E Ratio
Reasonable Price to Sales Ratio
Strong Net Profit Margin
Good Return on Equity
Low Debt to Assets Ratio
📈 Strong Revenue Growth
💪 Positive Operating Leverage
🔒 Solid Capital Position
🌱 Revenue Growth Guidance
🚀 Innovation in Payments
High EV/EBITDA Ratio
Moderate Operating Profit Margin
Current and Quick Ratios at Zero
High Debt to Equity Ratio
📉 Modest Loan Growth
⚠️ Competitive Pressures
Overall, U.S. Bancorp exhibits strong business quality with solid revenue growth, effective expense management, and a healthy capital position. However, it faces challenges with modest loan growth and competitive pressures in the payments sector. Looking forward, the bank has promising growth prospects supported by revenue growth guidance and innovation initiatives, although it must navigate industry competition carefully.
Analysis Date: January 16, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$114.18
Current Market Price: $36.78
IV/P Ratio: 3.10x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
68.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for USB
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (9.59)
P/B ratio ≤ 1.5 (1.03)
Current ratio ≥ 2.0 (0.28x)
Long-term debt < Net current assets (-0.15x)
Margin of safety (68.0%)
USB does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
USB's net profit margin stands at 18.32%, indicating effective cost management and strong profitability relative to sales.
A return on equity of 10.98% shows that USB is effectively using shareholders' equity to generate profits, which is a positive indicator for investors.
The operating profit margin of 18.41% is solid but could be improved to enhance competitiveness against peers.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
10.98%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
0.25%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
98.75%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
18.32%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
USB's debt to assets ratio of 9.67% indicates a conservative approach to leverage, suggesting financial stability.
The current ratio and quick ratio of 0.0 indicate potential liquidity issues, meaning USB may struggle to cover short-term liabilities.
The debt to equity ratio of 1.12 indicates that USB is quite leveraged, which could pose risks in economic downturns.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
1.25x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
0.28x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
U.S. Bancorp reported a net revenue of $7 billion for the quarter and $27.5 billion for the year, showcasing both sequential and year-over-year growth in net interest income and non-interest income. This was driven by effective balance sheet management and a diversified fee business.
The company delivered 190 basis points of positive operating leverage on an adjusted basis year-over-year, indicating effective expense management alongside revenue growth.
The CET1 capital ratio increased to 10.6%, reflecting strong capital management and stability. This positions the bank well ahead of regulatory requirements.
Average loans grew only 0.4% on a linked quarter basis, indicating a cautious lending environment and potential headwinds in loan demand.
For 2025, the company expects total revenue growth of 3% to 5%, demonstrating confidence in its diversified revenue streams and ongoing initiatives to drive growth.
U.S. Bancorp is focusing on enhancing its payments business through strategic reorganizations and investments, aiming for better integration across its consumer and institutional franchises.
The payments sector continues to face stiff competition from fintechs and other banks, which may impact market share and profitability.