As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at regional banks stocks, starting with Webster Financial (NYSE:WBS).
Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.
The 105 regional banks stocks we track reported a mixed Q1. As a group, revenues missed analysts’ consensus estimates by 1.6%.
Luckily, regional banks stocks have performed well with share prices up 13.9% on average since the latest earnings results.
Webster Financial (NYSE:WBS)
Founded during the Great Depression in 1935 and evolving into a major Northeastern financial institution, Webster Financial (NYSE:WBS) is a bank holding company that provides commercial banking, consumer banking, and employee benefits solutions through its Webster Bank and HSA Bank division.
Webster Financial reported revenues of $704.8 million, up 5.7% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a significant miss of analysts’ EPS estimates and tangible book value per share in line with analysts’ estimates.
Interestingly, the stock is up 24.6% since reporting and currently trades at $58.68.
Is now the time to buy Webster Financial? Access our full analysis of the earnings results here, it’s free.
Best Q1: Butterfield Bank (NYSE:NTB)
Founded in 1784 as one of the oldest banks in the Western Hemisphere, Butterfield Bank (NYSE:NTB) provides banking, wealth management, and trust services to individuals and businesses in select offshore financial centers including Bermuda, Cayman Islands, and the Channel Islands.
Butterfield Bank reported revenues of $147.8 million, up 3.7% year on year, outperforming analysts’ expectations by 4.4%. The business had a stunning quarter with a solid beat of analysts’ net interest income estimates and an impressive beat of analysts’ EPS estimates.
The market seems happy with the results as the stock is up 9.2% since reporting. It currently trades at $46.34.
Is now the time to buy Butterfield Bank? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Triumph Financial (NASDAQ:TFIN)
Originally focused on traditional banking before pivoting to serve the transportation sector, Triumph Financial (NASDAQ:TFIN) provides specialized financial services to the trucking industry, including payments processing, factoring, banking, and data intelligence solutions.
Triumph Financial reported revenues of $100.8 million, flat year on year, falling short of analysts’ expectations by 3.8%. It was a disappointing quarter as it posted a significant miss of analysts’ tangible book value per share and net interest income estimates.
Interestingly, the stock is up 27.9% since the results and currently trades at $63.72.
Read our full analysis of Triumph Financial’s results here.
United Bankshares (NASDAQ:UBSI)
With roots dating back to 1982 and a strong presence in the Mid-Atlantic region, United Bankshares (NASDAQ:UBSI) is a bank holding company that provides commercial and retail banking services through its United Bank subsidiary across multiple states.
United Bankshares reported revenues of $289.6 million, up 13.7% year on year. This number topped analysts’ expectations by 4.1%. It was a stunning quarter as it also put up an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ net interest income estimates.
The stock is up 2.9% since reporting and currently trades at $38.09.
Read our full, actionable report on United Bankshares here, it’s free.
Axos Financial (NYSE:AX)
Originally founded as Bank of Internet USA in 1999 before rebranding in 2018, Axos Financial (NYSE:AX) is a diversified financial services company that provides digital banking, securities clearing, and investment advisory solutions to retail and business customers nationwide.
Axos Financial reported revenues of $308.8 million, up 4.8% year on year. This result surpassed analysts’ expectations by 1%. More broadly, it was a mixed quarter as it also recorded tangible book value per share in line with analysts’ estimates but net interest income in line with analysts’ estimates.
The stock is up 15.8% since reporting and currently trades at $83.86.
Read our full, actionable report on Axos Financial here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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