Wrapping up Q2 earnings, we look at the numbers and key takeaways for the regional banks stocks, including BancFirst (NASDAQ: BANF) 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 98 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. On average, they are relatively unchanged 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 $169.3 million, up 10.2% year on year. This print exceeded analysts’ expectations by 3%. Overall, it was a strong quarter for the company with EPS in line with analysts’ estimates and an impressive beat of analysts’ net interest income estimates.
Unsurprisingly, the stock is down 3.7% since reporting and currently trades at $126.68.
We think BancFirst is a good business, but is it a buy today? Read our full report 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 EPS in line with analysts’ estimates and a solid beat of analysts’ tangible book value per share estimates.
The market seems happy with the results as the stock is up 6.3% since reporting. It currently trades at $116.68.
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 estimates and a significant miss of analysts’ EPS estimates.
Interestingly, the stock is up 6.9% since the results and currently trades at $108.45.
Read our full analysis of Coastal Financial’s results here.
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 $321.4 million, up 10.5% year on year. This print topped analysts’ expectations by 3.4%. It was a strong quarter as it also produced EPS in line with analysts’ estimates and tangible book value per share in line with analysts’ estimates.
The stock is up 5.5% since reporting and currently trades at $90.
Read our full, actionable report on Axos Financial here, it’s free.
United Community Banks (NYSE: UCB)
Starting as a small community bank in 1950 and expanding through strategic acquisitions across the Southeast, United Community Banks (NYSE: UCB) is a regional bank holding company that provides financial services including loans, deposits, wealth management, and merchant services across the southeastern United States.
United Community Banks reported revenues of $260.2 million, up 6.1% year on year. This result met analysts’ expectations. Aside from that, it was a mixed quarter as its performance in some other areas of the business was disappointing.
The stock is flat since reporting and currently trades at $31.57.
Read our full, actionable report on United Community Banks here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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