Why CVB Financial Corp. (NASDAQ: CVBF) stock is rising

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CVB Financial Corp. (NASDAQ: CVBF) stock rose over 6.6% on 23rd July, 2020 (as of 12:38 pm GMT-4; Source: Google finance) after the company posted better than expected results for the second quarter of FY 20. CVBF has net income of $41.6 million for the second quarter of FY 20, as compared with $38.0 million for the first quarter of 2020 and $54.5 million for the second quarter of 2019. The Company has recorded $11.5 million in provision for credit losses during the second quarter on the back of the further deterioration in the forecasted economic impact from the coronavirus pandemic. During the second quarter of 2020, the Company originated, under the SBA Paycheck Protection Program, about 4,100 loans, of which $1.1 billion was outstanding at June 30, 2020. For the second quarter of 2020, the company produced an annualized return on average equity (ROAE) of 8.51% and an annualized return on average tangible common equity (ROATCE) of 13.80%. ROAE and ROATCE for the first quarter of 2020 were 7.61% and 12.27 %, respectively, and 11.38% and 18.81%, respectively, for the second quarter of 2019. The company posted an annualized return on average assets (ROAA) of 1.33% for the second quarter, compared to 1.34% for the first quarter of 2020 and 1.95% for the second quarter of 2019. The efficiency ratio for the second quarter of 2020 has fallen to 39.75%, compared to 42.69% for the first quarter of 2020 and 39.09% for the second quarter of 2019.

Moreover, Net interest income, before provision for credit losses, was $104.6 million for the second quarter of 2020, compared to $102.3 million for the first quarter of 2020 and $111.1 million for the second quarter of 2019. The net interest margin (tax equivalent) stood at 3.70% for the second quarter of 2020, compared to 4.08% for the first quarter of 2020 and 4.49% for the second quarter of 2019. The Company reported total assets of $13.75 billion at the end of June, 2020, which represents an increase of 18.48%, from total assets of $11.61 billion at March 31, 2020.

CVBF in the second quarter of FY 20 has reported the adjusted earnings per share of 31 cents, beating the analysts’ estimates for the adjusted earnings per share of 27 cents, according to Zacks Investment Research. The company had reported the adjusted revenue of $116.7 million in the second quarter of FY 20.

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