Citi has reaffirmed its Buy rating on Wintrust Financial (NASDAQ: NASDAQ:WTFC), maintaining a $126.00 price target for the company's shares.
The endorsement came after Wintrust reported its earnings following the market close on Monday. The financial institution posted core earnings per share (EPS) of $2.45, which was slightly below the consensus estimate of $2.51. The reported GAAP EPS was $2.47.
Wintrust's overall growth was noted to surpass expectations, and a stronger-than-anticipated net interest margin (NIM) contributed to net interest income (NII) that exceeded consensus predictions.
However, fee income did not meet expectations, largely due to mortgage servicing rights (MSR) headwinds. The company also incurred expenses that were marginally higher than anticipated, resulting in core pre-provision net revenue (PPNR) that was somewhat below the consensus models.
The company's credit quality was described as healthy, with limited loan loss provision (LLP) expenses helping to keep EPS close to the estimated figures. The analyst from Citi emphasized that the positioning was crowded into the results, and while PPNR was below expectations, a significant portion of this was related to MSR.
In other recent news, Wintrust Financial has seen a surge in its stock price target by Citi, due to strong loan growth trends. The financial institution reported second-quarter earnings per share (EPS) of $2.32 and revenue for the quarter at $591.75 million. Citi expects Wintrust's net interest income (NII) to continue to rise into 2025, citing the company's strong loan growth and stable new money loan yields.
Various firms have shown confidence in Wintrust Financial. Truist Securities increased the price target to $118, reiterating a Buy rating. This followed a reassessment of the company's earnings projections and the integration of the Macatawa acquisition, anticipated to complete in the latter part of the fourth quarter of 2024.
Piper Sandler adjusted its outlook on the company, increasing the price target to $125 while maintaining an Overweight rating. RBC Capital maintained its Outperform rating on the company, with a steady price target of $117.00. DA Davidson raised the price target for Wintrust Financial to $125, maintaining a positive outlook on the company's net interest income (NII).
InvestingPro Insights
Wintrust Financial's recent performance and Citi's reaffirmed Buy rating are further supported by several key metrics from InvestingPro. The company's market capitalization stands at $7.47 billion, with a P/E ratio of 11.54, indicating a potentially attractive valuation relative to its earnings. This aligns with Citi's bullish stance on the stock.
InvestingPro Tips highlight Wintrust's strong dividend history, having raised its dividend for 10 consecutive years and maintained payments for 25 years. This demonstrates the company's commitment to shareholder returns, which could be appealing to income-focused investors. Additionally, Wintrust has been profitable over the last twelve months, with analysts predicting continued profitability this year.
However, it's worth noting that 5 analysts have revised their earnings downwards for the upcoming period, which may reflect the slight miss in EPS reported in the recent earnings. Despite this, Wintrust has shown a high return over the last year, with a 1-year price total return of 54.37%, significantly outperforming many of its peers.
For investors seeking more comprehensive analysis, InvestingPro offers 7 additional tips that could provide deeper insights into Wintrust Financial's prospects.
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