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1. Company Snapshot

1.a. Company Description

TFS Financial Corporation, through its subsidiaries, provides retail consumer banking services in the United States.Its deposit products include savings, money market, checking, individual retirement, and other qualified plan accounts, as well as certificates of deposit.The company also provides residential real estate mortgage loans, residential construction loans, and home equity loans and lines of credit, as well as purchase mortgages and first mortgage refinance loans.


In addition, it offers escrow and settlement services.The company provides its products and services through its main office in Cleveland, Ohio; and 37 full-service branches and 7 loan production offices located throughout the states of Ohio and Florida.The company was founded in 1938 and is headquartered in Cleveland, Ohio.


TFS Financial Corporation operates as a subsidiary of Third Federal Savings and Loan Association of Cleveland, MHC.

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1.b. Last Insights on TFSL

TFS Financial Corporation's recent performance is driven by favorable business conditions, with expected rate cuts poised to boost net interest margins (NIMs) and loan growth. The company's asset quality remains pristine, with robust deposit growth and strong asset quality indicators. A unique mutual holding structure supports an attractive dividend yield of approximately 8.65% for minority shareholders. With mortgage rates anticipated to decline, loan growth is expected to accelerate, positioning the company for near-term tailwinds.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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TFS Financial Corporation $TFSL Shares Bought by Geode Capital Management LLC

Dec -02

Source: defenseworld.net

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TFS Financial: Huge Bargain At 7x Earnings With An 8%+ Dividend Yield

Nov -17

Source: seekingalpha.com

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Critical Analysis: Pathfinder Bancorp (NASDAQ:PBHC) vs. TFS Financial (NASDAQ:TFSL)

Oct -26

Source: defenseworld.net

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TFS Financial: A Unique Dividend Play With Near-Term Tailwinds

Jul -21

Source: seekingalpha.com

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TFS Financial (TFSL) Matches Q2 Earnings Estimates

Apr -30

Source: zacks.com

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TFS Financial Corp: A Long-Forgotten Second-Step Thrift Conversion Can Still Provide Value

Mar -28

Source: seekingalpha.com

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TFS Financial: Prioritizing Stability For Dividend Investors

Dec -28

Source: seekingalpha.com

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TFS Financial Corporation Announces Fourth Quarter and 2024 Fiscal Year Results

Oct -30

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.55%)

6. Segments

Retail Consumer Banking

Expected Growth: 4.55%

TFS Financial Corporation's Retail Consumer Banking segment growth of 4.55% is driven by increasing demand for digital banking services, expansion of branch network, and strategic partnerships. Additionally, favorable interest rates, rising consumer spending, and effective cost management contribute to the growth. Furthermore, the segment benefits from a strong brand reputation and customer loyalty, leading to increased market share and revenue growth.

7. Detailed Products

Home Equity Loans

TFS Financial Corporation offers home equity loans that allow homeowners to borrow money using the equity in their homes as collateral.

Mortgage Loans

TFS Financial Corporation provides mortgage loans for purchasing or refinancing a home, with a range of options including fixed-rate and adjustable-rate loans.

Home Equity Lines of Credit (HELOCs)

TFS Financial Corporation's HELOCs allow homeowners to tap into the equity in their homes and use the funds for various expenses.

Auto Loans

TFS Financial Corporation offers auto loans for purchasing or refinancing a vehicle, with competitive rates and flexible terms.

Personal Loans

TFS Financial Corporation's personal loans provide unsecured financing for various expenses, such as debt consolidation, weddings, or unexpected expenses.

Credit Cards

TFS Financial Corporation offers credit cards with competitive rates, rewards programs, and flexible payment terms.

Investment and Insurance Services

TFS Financial Corporation offers investment and insurance services, including retirement planning, investment management, and insurance products.

8. TFS Financial Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

TFS Financial Corporation operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand recognition and customer loyalty mitigate the threat of substitutes.

Bargaining Power Of Customers

TFS Financial Corporation's customers have significant bargaining power due to the availability of alternative financial services providers. The company must maintain competitive pricing and services to retain customers.

Bargaining Power Of Suppliers

TFS Financial Corporation has a diversified supplier base, which reduces the bargaining power of individual suppliers. The company's strong financial position also gives it negotiating power in supplier relationships.

Threat Of New Entrants

While there are barriers to entry in the financial services industry, new entrants can still disrupt the market. TFS Financial Corporation must continue to innovate and improve its services to stay competitive.

Intensity Of Rivalry

The financial services industry is highly competitive, with many established players and new entrants vying for market share. TFS Financial Corporation must focus on differentiating its services and maintaining a strong brand presence to stay ahead of competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 77.65%
Debt Cost 7.20%
Equity Weight 22.35%
Equity Cost 7.20%
WACC 7.20%
Leverage 347.42%

11. Quality Control: TFS Financial Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

14.2$

Current Price

14.21$

Potential

-0.00%

Expected Cash-Flows