Coastal Financial currently trades at $111.16 and has been a dream stock for shareholders. Itโs returned 702% since October 2020, blowing past the S&P 500โs 94.1% gain. The company has also beaten the index over the past six months as its stock price is up 31.6%.
Is it too late to buy CCB? Find out in our full research report, itโs free for active Edge members.
Why Is Coastal Financial a Good Business?
Pioneering the intersection of traditional banking and financial technology in the Pacific Northwest, Coastal Financial (NASDAQ: CCB) operates as a bank holding company that provides traditional banking services and Banking-as-a-Service (BaaS) solutions to consumers and businesses.
1. Net Interest Income Skyrockets, Fueling Growth Opportunities
Markets consistently prioritize net interest income over non-recurring fees, recognizing its superior quality compared to the more unpredictable revenue streams.
Coastal Financialโs net interest income has grown at a 43.2% annualized rate over the last five years, much better than the broader banking industry.
2. Elite Net Interest Margin Powers Best-In-Class Loan Book
Net interest margin (NIM) represents how much a bank earns in relation to its outstanding loans. It's one of the most important metrics to track because it shows how a bank's loans are performing and whether it has the ability to command higher premiums for its services.
Over the past two years, we can see that Coastal Financialโs net interest margin averaged an elite 7.2%, indicating the company has a high-yielding loan book and a low cost of funds.
3. Outstanding Long-Term EPS Growth
We track the long-term change in earnings per share (EPS) because it highlights whether a companyโs growth is profitable.
Coastal Financialโs EPS grew at an astounding 22.7% compounded annual growth rate over the last five years. This performance was better than most banking businesses.
Final Judgment
These are just a few reasons why we think Coastal Financial is one of the best banking companies out there, and with its shares beating the market recently, the stock trades at 3.4ร forward P/B (or $111.16 per share). Is now a good time to buy? See for yourself in our in-depth research report, itโs free for active Edge members.
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