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 BancFirst (NASDAQ:BANF).
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.
In light of this news, share prices of the companies have held steady as they are up 1.6% on average since the latest earnings results.
BancFirst (NASDAQ:BANF)
Operating as a "super community bank" with a decentralized management approach that emphasizes local responsiveness, BancFirst Corporation (NASDAQ:BANF) operates as a financial holding company providing commercial banking services to retail customers and small to medium-sized businesses primarily in Oklahoma and Texas.
BancFirst reported revenues of $164.8 million, up 8.9% year on year. This print exceeded analysts’ expectations by 2.4%. Overall, it was a strong quarter for the company with a solid beat of analysts’ net interest income estimates and a narrow beat of analysts’ tangible book value per share estimates.
BancFirst Corporation CEO David Harlow commented, "The Company continues to perform fundamentally well; however, the current bond and equity market volatility presents a unique backdrop. The ultimate impact on our region's economy, our customers and, thus, credit quality remains to be seen. We are cautious in our outlook for the remainder of the year with the likelihood of an economic slowdown increasing and, as a result, our reserve for credit losses as a percentage of loans is unchanged from year-end 2024."
Interestingly, the stock is up 9.5% since reporting and currently trades at $119.90.
Is now the time to buy BancFirst? 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.
However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $42.41.
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 15% since the results and currently trades at $57.31.
Read our full analysis of Triumph Financial’s results here.
First Horizon (NYSE:FHN)
Tracing its roots back to 1864 during the Civil War era, First Horizon (NYSE:FHN) is a Tennessee-based bank holding company that provides commercial and consumer banking, wealth management, and specialty financial services across multiple states.
First Horizon reported revenues of $812 million, flat year on year. This result missed analysts’ expectations by 1.3%. All in all, it was a mixed quarter for the company.
The stock is up 8.2% since reporting and currently trades at $19.03.
Read our full, actionable report on First Horizon here, it’s free.
First Citizens BancShares (NASDAQ:FCNCA)
With roots dating back to 1898 and a significant expansion through its 2023 acquisition of Silicon Valley Bank, First Citizens BancShares (NASDAQGS:FCNC.A) is a bank holding company that provides financial services to individuals and businesses through its First-Citizens Bank & Trust Company subsidiary.
First Citizens BancShares reported revenues of $2.30 billion, down 6% year on year. This number came in 1.3% below analysts' expectations. It was a slower quarter as it also produced a miss of analysts’ net interest income estimates and EPS in line with analysts’ estimates.
The stock is up 2.7% since reporting and currently trades at $1,819.
Read our full, actionable report on First Citizens BancShares here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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