MBNKP - Medallion Financial: Dividend Growth Opportunity In Preferred Shares
2024-04-15 01:33:24 ET
Summary
- Medallion Financial has successfully transitioned away from lending to taxicab drivers and now lends its depositors' money for recreational and home improvement loans.
- The bank had a strong 2023, with net interest income rising by nearly 20% and net income after taxes increasing to $61 million.
- Medallion Financial's loan composition and customer base, particularly in the home improvement segment, are fueling earnings growth. The bank lends to customers with strong credit scores and has a high average interest rate of 12.87%.
- Medallion Financial's preferred share dividends float next April, providing for an income growth opportunity.
Medallion Financial ( MFIN ) is a niche bank that has successfully pivoted away from lending to taxicab drivers. Today, the bank manages deposits and lends them out for recreational and home improvement loans. Recently, I came across the bank’s 8% fix to floating preferred share ( MBNKP ). After reviewing the financials, I believe the fixed to floating preferred share presents a great income opportunity for investors with the potential for income growth when the shares float next April....
Medallion Financial: Dividend Growth Opportunity In Preferred Shares