Western Alliance Bancorporation (WAL): fair value, margin of safety and Wheel Score

Is WAL undervalued?

Western Alliance Bancorporation (WAL) closed at 72.22 on 16 Oct 2026. The GLS average fair value - the simple average of the 7 valuation models that produced a positive number - is 147.19, which puts the price 51% below it. 5 of the 7 models value the shares above the current price. A gap this wide is rare in our universe of ~7,400 US stocks and is exactly what the Value part of the Wheel Score rewards; it is also where the question "why is it this cheap?" matters most.

The 7 models disagree widely: DDM gives 24.72 while Graham Growth gives 388.11. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.

The nightly engine files WAL under Value: positive earnings at a P/E of 18 or less.

Nine valuation models for WAL

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Financial health is average - WAL passes 5 of the nine Piotroski tests, which falls one point short of the Sunday Scan's "6 or more" rule. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is 5.3 out of 10: a ten-year record that is consistent in some of the metrics the score tracks (revenue, earnings, margins, cash flow, returns on capital) and patchy in others.

Returns on capital are moderate - ROIC 6.9%, ROE 12.7%, ROA 1.0% - with debt at 0.85 times equity and negative free cash flow.

The dividend yield is 2.33% at a payout ratio of 19%; for a wheel trader holding assigned shares the dividend adds to the covered-call premium, and the ex-dividend date is worth knowing before a call is sold. Revenue comes mainly from Interchange Fees 58%, Other Fees 43% (quarter Q1 FY2026).

Institutional ownership scores 10/10, insider activity 5/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 82: Prime

WAL scores 82 out of 100 on the Wheel Score, in the Prime band (80 and above), which fewer than one stock in twenty reaches on any night. The score blends five things a wheel trader checks before selling a cash-secured put: the margin of safety (Value, 25/25), Piotroski health (11/20), the GLS moat (8/15), the option premium on offer (20/20) and how easily the stock trades (18/20).

Implied volatility is 43% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is 22,762 contracts across all expiries - enough for the wheel at normal size.

Volume runs at 1.7M shares a day on a market cap of $7.9B, with a beta of 1.42 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 18 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

Western Alliance Bancorporation reports earnings on 19 Oct 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Banks - Regional

The 12 companies below are the closest to Western Alliance Bancorporation by market cap within the Banks - Regional industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

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