Wintrust Financial (NASDAQ:WTFC) Corporation (NASDAQ: WTFC) has maintained its Overweight rating and $131.00 price target by Piper Sandler following the release of the company's third-quarter financial results.
Wintrust Financial reported an operating earnings per share (EPS) of $2.57, surpassing the consensus estimate of $2.49 and Piper Sandler's own estimate of $2.53. The reported EPS was $2.47, which included adjustments for a $11.4 million Mortgage Servicing Rights (MSR) Fair Value (FV) adjustment, $3.1 million in securities gains, and $1.6 million of acquisition-related costs.
The better-than-expected results were attributed to lower provisioning, which added $0.19 to the EPS, and stronger Net Interest Income (NII), contributing an additional $0.05. These gains were slightly offset by an increase in operating expenses, which had a $0.09 negative impact on the EPS, as well as higher tax rates and share count, each reducing EPS by $0.01, and a decrease in core fee income by $0.05.
Despite operating Pre-Provision Net Revenue (PPNR) being 3% below expectations due to lower mortgage revenue, partly from a decline in Gain on Sale (GOS) margin, and an increase in operating expenses, Piper Sandler expressed optimism.
In other recent news, Wintrust Financial reported earnings per share (EPS) of $2.45, slightly below the consensus estimate of $2.51. The financial institution's overall growth surpassed expectations, with a stronger-than-anticipated net interest margin (NIM) contributing 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's credit quality was described as healthy, with limited loan loss provision (LLP) expenses helping to keep EPS close to the estimated figures.
In addition, Wintrust Financial has seen an increase in its stock price target by Citi, due to strong loan growth trends. Citi, along with other firms such as Truist Securities, Piper Sandler, RBC Capital, and DA Davidson, have shown confidence in Wintrust Financial, adjusting their price targets and maintaining positive ratings.
These adjustments followed the company's earnings projections and the integration of the Macatawa acquisition, anticipated to be completed in the latter part of the fourth quarter of 2024.
InvestingPro Insights
Wintrust Financial Corporation's recent performance and future outlook are further illuminated by key metrics and insights 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 earnings. This aligns with Piper Sandler's Overweight rating and optimistic outlook.
InvestingPro data shows that Wintrust has demonstrated strong financial health, with a revenue of $2.22 billion in the last twelve months as of Q2 2024, representing a growth of 6.88%. The company's profitability is underscored by its impressive operating income margin of 42.06% for the same period, reflecting efficient operations and cost management.
Two particularly relevant InvestingPro Tips highlight Wintrust's commitment to shareholder returns. The company has raised its dividend for 10 consecutive years and has maintained dividend payments for 25 consecutive years. This consistent dividend policy aligns with the company's strong financial performance and may appeal to income-focused investors.
It's worth noting that InvestingPro offers 5 additional tips for Wintrust Financial, providing a more comprehensive analysis for investors seeking deeper insights into the company's prospects.
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