Looking back on regional banks stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including First Financial Bankshares (NASDAQ: FFIN) and its peers.
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 99 regional banks stocks we track reported a satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.
In light of this news, share prices of the companies have held steady as they are up 1.9% on average since the latest earnings results.
First Financial Bankshares (NASDAQ: FFIN)
With roots dating back to 1890 and a network spanning over 70 locations across the Lone Star State, First Financial Bankshares (NASDAQ: FFIN) is a Texas-focused regional bank providing commercial banking, trust services, and wealth management across numerous communities throughout the state.
First Financial Bankshares reported revenues of $156.6 million, up 14.2% year on year. This print exceeded analysts’ expectations by 1.9%. Despite the top-line beat, it was still a mixed quarter for the company with a narrow beat of analysts’ tangible book value per share estimates but a slight miss of analysts’ net interest income estimates.
Unsurprisingly, the stock is down 3.7% since reporting and currently trades at $35.43.
Is now the time to buy First Financial Bankshares? Access our full analysis of the earnings results here, it’s free.
Best Q2: UMB Financial (NASDAQ: UMBF)
With roots dating back to 1913 and a name derived from "United Missouri Bank," UMB Financial (NASDAQ: UMBF) is a financial holding company that provides banking, asset management, and fund services to commercial, institutional, and individual customers.
UMB Financial reported revenues of $689.2 million, up 76.7% year on year, outperforming analysts’ expectations by 8.6%. The business had a stunning quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ tangible book value per share estimates.
The market seems happy with the results as the stock is up 9.7% since reporting. It currently trades at $120.40.
Is now the time to buy UMB Financial? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Coastal Financial (NASDAQ: CCB)
Pioneering the intersection of traditional banking and financial technology in the Pacific Northwest, Coastal Financial (NASDAQ: CCB) operates as a bank holding company that provides traditional banking services and Banking-as-a-Service (BaaS) solutions to consumers and businesses.
Coastal Financial reported revenues of $119.4 million, down 11.7% year on year, falling short of analysts’ expectations by 21.5%. It was a disappointing quarter as it posted a significant miss of analysts’ net interest income and EPS estimates.
Interestingly, the stock is up 7.5% since the results and currently trades at $109.01.
Read our full analysis of Coastal Financial’s results here.
WSFS Financial (NASDAQ: WSFS)
Founded in 1832 as Wilmington Savings Fund Society and one of the oldest banks in America still operating under its original name, WSFS Financial (NASDAQ: WSFS) operates a community banking and wealth management franchise primarily serving customers in the Mid-Atlantic region through its main subsidiary, WSFS Bank.
WSFS Financial reported revenues of $267.5 million, flat year on year. This number beat analysts’ expectations by 1.2%. It was a strong quarter as it also logged a beat of analysts’ EPS estimates and a narrow beat of analysts’ tangible book value per share estimates.
The stock is down 2.2% since reporting and currently trades at $55.35.
Read our full, actionable report on WSFS Financial here, it’s free.
Amalgamated Financial (NASDAQ: AMAL)
Founded in 1923 by labor unions seeking a financial institution aligned with worker values, Amalgamated Financial (NASDAQGM:AMAL) operates a values-oriented bank that provides commercial banking, trust services, and investment management to socially responsible organizations and individuals.
Amalgamated Financial reported revenues of $82.18 million, up 4.8% year on year. This print was in line with analysts’ expectations. However, it was a slower quarter as it recorded a narrow beat of analysts’ EPS estimates and net interest income in line with analysts’ estimates.
The stock is down 15.2% since reporting and currently trades at $28.19.
Read our full, actionable report on Amalgamated Financial here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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