Unity Bancorp, Inc. (UNTY) | Investment Case

1. Company Snapshot

1.a. Company Description

Unity Bancorp, Inc.operates as the holding company for Unity Bank that provides commercial and retail banking products and services to individuals, small and medium sized businesses, and professional communities.The company offers personal and business checking accounts, time deposits, money market accounts, and regular savings accounts, as well as noninterest and interest-bearing demand deposits.

It also provides small business administration loans; commercial loans; and residential mortgage and consumer loans, including residential real estate, home equity lines and loans, and residential construction lines, as well as personal loans.the company offered its services through the Internet and nineteen branch offices located in Bergen, Hunterdon, Middlesex, Somerset, Union, and Warren counties in New Jersey, as well as Northampton County, Pennsylvania.Unity Bancorp, Inc.

was incorporated in 1991 and is based in Clinton, New Jersey.

Show Full description

1.b. Last Insights on UNTY

Unity Bancorp's recent performance was driven by strong Q2 results, characterized by loan and deposit growth, margin expansion, and improved return metrics. The company's quarterly earnings of $1.2 per share beat estimates, representing a 29% year-over-year increase. A 7% increase in the third quarter dividend, announced on August 21, underscores the company's commitment to shareholder returns. This move, along with its expanding branch network, including a new location in Madison, New Jersey, highlights Unity Bancorp's operational strength and growth strategy.

1.c. Company Highlights

Last Price	56.34
Change Percentage	1.77%
Open	56.08
Previous Close	55.36
Market Cap ( Millions)	565
Volume	36092
Year High	57.24
Year Low	36.65
M A 50	48.71
M A 200	46.98

FCF Yield	5.71%
Dividend Yield	1.03%
ROE	17.20%
Debt / Equity	72.46%
Net Debt / EBIDTA	46.33%
Price To Book	1.69
Price Earnings Ratio	10.48
Price To FCF	17.52
Price To sales	2.85
EV / EBITDA	8.3

2. Transcript Summary

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3. NewsRoom

Unity Bancorp, Inc. Announces Executive Leadership Promotions

Nov -20

Source: globenewswire.com

Unity Bancorp Announces Fourth Quarter Dividend

Nov -20

Source: globenewswire.com

Connor Clark & Lunn Investment Management Ltd. Sells 1,194 Shares of Unity Bancorp, Inc. $UNTY

Nov -17

Source: defenseworld.net

Unity Bancorp (UNTY) Reports Q3 Earnings: What Key Metrics Have to Say

Oct -14

Source: zacks.com

Unity Bancorp (UNTY) Q3 Earnings and Revenues Surpass Estimates

Oct -14

Source: zacks.com

Unity Bancorp Reports Quarterly Earnings of $14.4 Million

Oct -14

Source: globenewswire.com

These 2 Must-Watch Firms Could Get a Boost From Earnings Reports

Oct -07

Source: marketbeat.com

Unity Bancorp: The Picture Justifies A Very Bullish Outlook Now (Rating Upgrade)

Oct -05

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.00%)

6. Segments

Banking and Related Activities

Expected Growth: 7.0%

Unity Bancorp, Inc.'s 7.0% growth in Banking and Related Activities is driven by strong loan growth, increased deposit market share, and expansion of commercial banking services. Additionally, strategic acquisitions, improved operating efficiency, and a favorable interest rate environment have contributed to the growth.

7. Detailed Products

Commercial Loans

Unity Bancorp, Inc. offers a range of commercial loans to businesses, including term loans, lines of credit, and construction loans, to support their growth and expansion plans.

Residential Mortgages

Unity Bancorp, Inc. provides residential mortgage loans to individuals and families, offering competitive rates and flexible repayment terms.

Consumer Banking

Unity Bancorp, Inc. offers a range of consumer banking services, including checking and savings accounts, credit cards, and personal loans, to meet the financial needs of individuals.

Treasury Management

Unity Bancorp, Inc. provides treasury management services to businesses, including cash management, wire transfers, and account reconciliation, to streamline their financial operations.

Wealth Management

Unity Bancorp, Inc. offers wealth management services, including investment and insurance products, to help individuals and businesses achieve their long-term financial goals.

8. Unity Bancorp, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Unity Bancorp, Inc. operates in a highly competitive industry, but the threat of substitutes is mitigated by the company's strong brand recognition and customer loyalty.

Bargaining Power Of Customers

Unity Bancorp, Inc. has a large customer base, but the bargaining power of customers is high due to the availability of alternative banking services.

Bargaining Power Of Suppliers

Unity Bancorp, Inc. has a diversified supplier base, which reduces the bargaining power of suppliers.

Threat Of New Entrants

The threat of new entrants in the banking industry is moderate, as it requires significant capital and regulatory approvals to establish a new bank.

Intensity Of Rivalry

The banking industry is highly competitive, with many established players competing for market share, which increases the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	58.43%
Debt Cost	5.24%
Equity Weight	41.57%
Equity Cost	9.17%
WACC	6.87%
Leverage	140.56%

11. Quality Control: Unity Bancorp, Inc. passed 4 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

TrustCo Bank Corp NY

A-Score: 6.7/10

Value: 5.8

Growth: 4.0

Quality: 7.3

Yield: 8.0

Momentum: 6.5

Volatility: 8.3

1-Year Total Return ->

Parke Bancorp

A-Score: 6.6/10

Value: 8.0

Growth: 4.4

Quality: 6.0

Yield: 7.0

Momentum: 6.0

Volatility: 8.0

1-Year Total Return ->

Unity Bancorp

A-Score: 6.3/10

Value: 6.6

Growth: 7.4

Quality: 6.4

Yield: 3.0

Momentum: 8.0

Volatility: 6.7

1-Year Total Return ->

Community West

A-Score: 6.2/10

Value: 5.7

Growth: 3.8

Quality: 6.6

Yield: 6.0

Momentum: 7.0

Volatility: 8.0

1-Year Total Return ->

Southside Bancshares

A-Score: 6.0/10

Value: 6.2

Growth: 5.6

Quality: 5.8

Yield: 8.0

Momentum: 2.5

Volatility: 8.0

1-Year Total Return ->

Heritage Commerce

A-Score: 6.0/10

Value: 3.9

Growth: 3.7

Quality: 7.3

Yield: 9.0

Momentum: 5.0

Volatility: 7.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-4.90%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

6.87%

Unity Bancorp, Inc. - US9132901029

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on UNTY

1.c. Company Highlights

Higher Growth

Average Quality

Stable Momentum

Earnings Beats

Revenues Beats

Average Growth

Average Yield

Revenues Miss

Strong Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.00%)

6. Segments

Banking and Related Activities

Expected Growth: 7.0%

7. Detailed Products

Commercial Loans

Residential Mortgages

Consumer Banking

Treasury Management

Wealth Management

8. Unity Bancorp, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Unity Bancorp, Inc. passed 4 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

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

56.34$

Current Price

56.34$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA