Webster Financial Q4 profit beats on higher interest income

Overview

• U.S. bank holding company's Q4 revenue and adjusted EPS beat analyst expectations

• Net income for Q4 rose significantly compared to the previous year

• Company repurchased 3.6 mln shares under share repurchase program

Outlook

• Webster Financial did not provide specific guidance for future quarters or full year

Result Drivers

• HIGHER NET INTEREST INCOME - Net interest income increased due to higher loan and deposit balances, despite a lower net interest margin

• NON-INTEREST INCOME GAINS - Non-interest income rose significantly due to gains on debt redemption, despite a decrease in credit valuation adjustment on derivatives

• STRATEGIC INVESTMENTS - Increased investments in human capital and technology contributed to higher non-interest expenses

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 16 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for Webster Financial Corp is $75.00, about 13.3% above its January 22 closing price of $66.22

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 9 three months ago

Press Release: ID:nBw7Dw8tta

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