IPO Report: Veritex Holdings (VBTX)

Francis Gaskins |

veritex holdings IPO, IPO report, IPOs this week, stocks to buy now, small-cap stocksVeritex Holdings ($VBTX) scheduled a $35 million IPO with a market capitalization of $118 million at a price range midpoint of $13 for Thursday, October 9, 2014 on Nasdaq. SEC filings

Seven other companies are scheduled for the week of Oct. 6, 2014. The full IPO calendar is available at IPOpremium.

Manager, Co-managers: Sandler O'Neill, Stephens Inc.
Joint-managers: 

End of lockup (180 days): Tuesday, April 7, 2015

End of 25-day quiet period: Monday, November 3, 2014

Veritex Holdings IPO Report

Overview

Veritex Holdings (VBTX) is a bank holding company headquartered in Dallas, Texas.

Valuation

Glossary

Valuation Ratios

Mrkt Cap (mm)

Price /Interest inc

Price /Erngs

Price /BkVlue

Price /TanBV

% offered in IPO

annualizing June 6 mos

         

Veritex Holdings (VBTX)

$117

5.0

27.1

1.1

1.5

30%

Conclusion

Neutral

Net interest income +18%

Net income +26%

Price-to-book 1.1

Business

VBTX is a bank holding company headquartered in Dallas, Texas.

Through its wholly-owned subsidiary, Veritex Community Bank, a Texas state chartered bank, VBTX provides relationship-driven commercial banking products and services tailored to meet the needs of small to medium-sized businesses and professionals.

Dallas focus

Since its inception, VBTX has targeted customers and focused its acquisitions primarily in the Dallas metropolitan area, which VBTX considers to be Dallas and the adjacent communities in North Dallas.

As it continues to grow, VBTX expects to expand its primary market to include the broader Dallas-Fort Worth metropolitan area, which would include Fort Worth and Arlington, as well as the communities adjacent to those cities.

VBTX currently operates eight branches and one mortgage office, all of which are located in the Dallas metropolitan area.

VBTX has experienced significant organic growth since commencing banking operations in 2010 and have successfully acquired and integrated three banks. As of June 30, 2014, VBTX had total assets of $710.4 million, total loans of $541.0 million, total deposits of $611.2 million and total stockholders' equity of $74.2 million.

Primary customers

VBTX’s primary customers are small and medium-sized businesses, generally with annual revenues of under $30 million, and professionals.

VBTX believes that these businesses and professionals highly value the local decision-making and relationship-driven, quality service VBTX provides and its deep, long-term understanding of the Dallas community and Texas banking.

As a result of consolidation, VBTX believes that there are few locally-based banks that are dedicated to providing this level of service to small and medium-sized businesses.

Management team

VBTX’s management team's long-standing presence and experience in the Dallas metropolitan area gives it unique insight into its local market and the needs of its customers.

This enables VBTX to respond quickly to customers, provide high quality personal service and develop comprehensive, long-term banking relationships by providing products and services tailored to meet the individual needs of its customers.

This focus and approach enhances VBTX’s ability to continue to grow organically, successfully recruit talented bankers and strategically source potential acquisitions in its target market.

Competition

VBTX’s banking competitors in its target markets include Chase Bank, Wells Fargo, Bank of America, BBVA Compass, Amegy Bank, Comerica Bank, Regions Bank, Prosperity Bank, Independent Bank, Texas Capital Bank and various community banks.

5% shareholders pre-IPO

William C. Murphy   8.9%

SunTx Veritex Holdings, LP 24.7%

Dividend Policy

No dividends are planned.

Use of proceeds

VBTX intends to use the $31 million in proceeds from its IPO as follows:

to support its continued growth, including organic growth and potential future acquisitions, and for general corporate purposes.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
VBTX Veritex Holdings Inc. 20.90 0.83 4.14 421,594

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