Are you still shorting Independent?

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15% of stocks are less volatile than Independent, and 98% of all traded equity instruments are projected to make higher returns than the company over the 60 days investment horizon. Although many risk-takers are getting more into financial services space, some of us are not very happy with Independent Bank's current volatility. We will evaluate if the latest Independent Bank price volatility suggests a bounce in February. Independent Bank's very low volatility may have no significant impact on the stock's value as we estimate Independent Bank as currently fairly valued. The real value, based on our calculations, is getting close to 76.85 per share.

Published over a year ago

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Reviewed by Ellen Johnson

Independent Bank Group currently holds roughly 3.08 B in cash with 277.9 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 71.62.

Volatility is a rate at which the price of Independent Bank or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Independent Bank may increase or decrease. In other words, similar to Independent's beta indicator, it measures the risk of Independent Bank and helps estimate the fluctuations that may happen in a short period of time. So if prices of Independent Bank fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our technical analysis page.

How important is Independent Bank's Liquidity

Independent Bank financial leverage refers to using borrowed capital as a funding source to finance Independent Bank Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Independent Bank financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Independent Bank's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Independent Bank's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Independent Bank's total debt and its cash.

Independent Bank Gross Profit

Independent Bank Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Independent Bank previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Independent Bank Gross Profit growth over the last 10 years. Please check Independent Bank's gross profit and other fundamental indicators for more details.

Independent Bank Volatility Drivers

Independent Bank unsystematic risk is unique to Independent Bank and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Independent Bank you can also buy Home Bancorp. You can also mitigate this risk by investing in the financials sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Independent Bank important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Independent Bank income statement and balance sheet. Here are more details about Independent volatility.

	Total Assets	Net Debt	Good Will	Total Liab	Common Stock	Capital Stock	Total Revenue	Gross Profit	Net Income	Tax Provision	Ptb Ratio	Pb Ratio	Ev To Sales	Payout Ratio	Pfcf Ratio	Pe Ratio	Current Ratio	Graham Number	Ebt Per Ebit	Quick Ratio	Cash Ratio	Debt Ratio	Market Cap
Total Assets		-0.54	0.92	1.0	0.98	0.85	0.84	0.84	0.81	0.6	-0.72	-0.72	-0.7	0.16	-0.34	-0.02	0.34	0.8	0.49	0.34	0.41	-0.88	0.96
Net Debt	-0.54		-0.39	-0.54	-0.48	-0.55	-0.32	-0.32	-0.62	-0.53	0.21	0.21	0.58	0.09	0.14	0.21	-0.75	-0.5	-0.23	-0.75	-0.76	0.46	-0.63
Good Will	0.92	-0.39		0.92	0.93	0.89	0.96	0.96	0.68	0.43	-0.7	-0.7	-0.74	0.36	-0.33	0.2	0.19	0.71	0.32	0.19	0.26	-0.92	0.84
Total Liab	1.0	-0.54	0.92		0.98	0.85	0.84	0.84	0.81	0.59	-0.72	-0.72	-0.7	0.17	-0.34	-0.01	0.34	0.79	0.49	0.34	0.41	-0.87	0.95
Common Stock	0.98	-0.48	0.93	0.98		0.82	0.82	0.82	0.84	0.65	-0.79	-0.79	-0.65	0.07	-0.38	-0.08	0.34	0.86	0.57	0.34	0.4	-0.89	0.96
Capital Stock	0.85	-0.55	0.89	0.85	0.82		0.9	0.9	0.67	0.41	-0.44	-0.44	-0.75	0.43	-0.21	0.21	0.31	0.56	0.11	0.31	0.38	-0.83	0.78
Total Revenue	0.84	-0.32	0.96	0.84	0.82	0.9		1.0	0.49	0.19	-0.57	-0.57	-0.75	0.59	-0.27	0.44	0.07	0.5	0.12	0.07	0.16	-0.85	0.71
Gross Profit	0.84	-0.32	0.96	0.84	0.82	0.9	1.0		0.49	0.19	-0.57	-0.57	-0.75	0.59	-0.27	0.44	0.07	0.5	0.12	0.07	0.16	-0.85	0.71
Net Income	0.81	-0.62	0.68	0.81	0.84	0.67	0.49	0.49		0.91	-0.59	-0.59	-0.47	-0.32	-0.29	-0.52	0.54	0.94	0.59	0.54	0.57	-0.72	0.9
Tax Provision	0.6	-0.53	0.43	0.59	0.65	0.41	0.19	0.19	0.91		-0.42	-0.42	-0.17	-0.57	-0.2	-0.68	0.55	0.86	0.64	0.55	0.54	-0.45	0.77
Ptb Ratio	-0.72	0.21	-0.7	-0.72	-0.79	-0.44	-0.57	-0.57	-0.59	-0.42		1.0	0.59	0.15	0.54	0.19	-0.16	-0.76	-0.75	-0.16	-0.19	0.76	-0.73
Pb Ratio	-0.72	0.21	-0.7	-0.72	-0.79	-0.44	-0.57	-0.57	-0.59	-0.42	1.0		0.59	0.15	0.54	0.19	-0.16	-0.76	-0.75	-0.16	-0.19	0.76	-0.73
Ev To Sales	-0.7	0.58	-0.74	-0.7	-0.65	-0.75	-0.75	-0.75	-0.47	-0.17	0.59	0.59		-0.37	0.34	-0.15	-0.3	-0.45	-0.09	-0.3	-0.37	0.83	-0.61
Payout Ratio	0.16	0.09	0.36	0.17	0.07	0.43	0.59	0.59	-0.32	-0.57	0.15	0.15	-0.37		0.21	0.91	-0.34	-0.38	-0.6	-0.34	-0.27	-0.21	-0.07
Pfcf Ratio	-0.34	0.14	-0.33	-0.34	-0.38	-0.21	-0.27	-0.27	-0.29	-0.2	0.54	0.54	0.34	0.21		0.2	-0.06	-0.43	-0.29	-0.06	-0.08	0.53	-0.35
Pe Ratio	-0.02	0.21	0.2	-0.01	-0.08	0.21	0.44	0.44	-0.52	-0.68	0.19	0.19	-0.15	0.91	0.2		-0.41	-0.49	-0.51	-0.41	-0.35	-0.02	-0.21
Current Ratio	0.34	-0.75	0.19	0.34	0.34	0.31	0.07	0.07	0.54	0.55	-0.16	-0.16	-0.3	-0.34	-0.06	-0.41		0.46	0.3	1.0	0.99	-0.22	0.46
Graham Number	0.8	-0.5	0.71	0.79	0.86	0.56	0.5	0.5	0.94	0.86	-0.76	-0.76	-0.45	-0.38	-0.43	-0.49	0.46		0.74	0.46	0.48	-0.75	0.89
Ebt Per Ebit	0.49	-0.23	0.32	0.49	0.57	0.11	0.12	0.12	0.59	0.64	-0.75	-0.75	-0.09	-0.6	-0.29	-0.51	0.3	0.74		0.3	0.29	-0.31	0.64
Quick Ratio	0.34	-0.75	0.19	0.34	0.34	0.31	0.07	0.07	0.54	0.55	-0.16	-0.16	-0.3	-0.34	-0.06	-0.41	1.0	0.46	0.3		0.99	-0.22	0.46
Cash Ratio	0.41	-0.76	0.26	0.41	0.4	0.38	0.16	0.16	0.57	0.54	-0.19	-0.19	-0.37	-0.27	-0.08	-0.35	0.99	0.48	0.29	0.99		-0.29	0.51
Debt Ratio	-0.88	0.46	-0.92	-0.87	-0.89	-0.83	-0.85	-0.85	-0.72	-0.45	0.76	0.76	0.83	-0.21	0.53	-0.02	-0.22	-0.75	-0.31	-0.22	-0.29		-0.81
Market Cap	0.96	-0.63	0.84	0.95	0.96	0.78	0.71	0.71	0.9	0.77	-0.73	-0.73	-0.61	-0.07	-0.35	-0.21	0.46	0.89	0.64	0.46	0.51	-0.81

Click cells to compare fundamentals

Detailed Perspective On Independent Bank

Independent Bank reported the previous year's revenue of 596.97 M. Net Income was 228.29 M with profit before overhead, payroll, taxes, and interest of 558.52 M.

Independent Bank is projected to stay under $77 in February

Coefficient of variation is down to 2429.19. It may suggest a possible volatility slide. Independent Bank Group currently demonstrates below-average downside deviation. It has Information Ratio of 0.07 and Jensen Alpha of 0.13. However, we advise investors to further question Independent Bank Group expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Independent Bank's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Independent Bank's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Independent Bank Implied Volatility

Independent Bank's implied volatility exposes the market's sentiment of Independent Bank Group stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Independent Bank's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Independent Bank stock will not fluctuate a lot when Independent Bank's options are near their expiration.

Our Final Take On Independent Bank

While some other firms within the banks—regional industry are still a little expensive, even after the recent corrections, Independent Bank may offer a potential longer-term growth to investors. On the whole, as of the 24th of January 2022, our concluding 90 days 'Buy-vs-Sell' recommendation on the company is Strong Buy. We believe Independent Bank is fairly valued with below average probability of distress for the next two years.

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Editorial Staff

Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI. View Profile

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Independent Bank Group. Please refer to our Terms of Use for any information regarding our disclosure principles.

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