Looking back on regional banks stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including Pacific Premier Bancorp (NASDAQ: PPBI) 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 103 regional banks stocks we track reported a satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 0.6%.
In light of this news, share prices of the companies have held steady as they are up 3.8% on average since the latest earnings results.
Pacific Premier Bancorp (NASDAQ: PPBI)
With a specialized division that serves homeowners' associations nationwide and a trust division that handles self-directed IRAs with alternative assets, Pacific Premier Bancorp (NASDAQ: PPBI) is a Western US regional bank that provides banking services to small and middle-market businesses, corporations, non-profits, and specialty markets.
Pacific Premier Bancorp reported revenues of $148.6 million, down 11.1% year on year. This print exceeded analysts’ expectations by 3.7%. Overall, it was a very strong quarter for the company with a beat of analysts’ EPS estimates and net interest income in line with analysts’ estimates.
Steven R. Gardner, Chairman, Chief Executive Officer, and President of the Company, commented, “We delivered strong financial results in the first quarter, generating net income of $36.0 million, or $0.37 per share. These results demonstrate our ability to build on the momentum established in the second half of 2024, reflecting non-interest income growth and lower operating expenses. Notably, the cost of funds decreased 14 bps from the prior quarter to 1.74%, driving a four-basis point expansion in our net interest margin to 3.06%. Additionally, we maintained our strong capital levels, with our tier 1 common equity ratio at 16.99% and our total risk-based capital ratio at 20.23%, placing us among the top of our peers.
Interestingly, the stock is up 9.3% since reporting and currently trades at $24.57.
Is now the time to buy Pacific Premier Bancorp? Access our full analysis of the earnings results here, it’s free.
Best Q1: 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 9.9% since reporting. It currently trades at $120.60.
Is now the time to buy UMB Financial? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: 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 $109.10.
Read our full analysis of Coastal Financial’s results here.
Cadence Bank (NYSE: CADE)
With roots dating back to 1885 and a strategic focus on middle-market commercial lending, Cadence Bancorporation (NYSE: CADE) is a bank holding company that provides commercial banking, retail banking, and wealth management services to middle-market businesses and individuals.
Cadence Bank reported revenues of $476.3 million, up 7.6% year on year. This print surpassed analysts’ expectations by 1.6%. Overall, it was a satisfactory quarter as it also recorded a narrow beat of analysts’ tangible book value per share estimates.
The stock is up 4.8% since reporting and currently trades at $37.70.
Read our full, actionable report on Cadence Bank here, it’s free.
S&T Bancorp (NASDAQ: STBA)
Tracing its roots back to 1902 in western Pennsylvania's industrial heartland, S&T Bancorp (NASDAQ: STBA) is a Pennsylvania-based bank holding company that provides retail and commercial banking services, cash management, trust services, and investment advisory solutions.
S&T Bancorp reported revenues of $100.1 million, up 3.3% year on year. This result topped analysts’ expectations by 1.5%. Zooming out, it was a mixed quarter as it also recorded a narrow beat of analysts’ net interest income and EPS estimates.
The stock is flat since reporting and currently trades at $39.05.
Read our full, actionable report on S&T Bancorp here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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