As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the regional banks industry, including Triumph Financial (NASDAQ: TFIN) 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 4.9% on average since the latest earnings results.
Triumph Financial (NASDAQ: TFIN)
Originally focused on traditional banking before pivoting to serve the transportation sector, Triumph Financial (NASDAQ: TFIN) provides specialized financial services to the trucking industry, including payments processing, factoring, banking, and data intelligence solutions.
Triumph Financial reported revenues of $107.4 million, up 2.2% year on year. This print exceeded analysts’ expectations by 1%. Overall, it was a strong quarter for the company with a beat of analysts’ EPS estimates and a narrow beat of analysts’ net interest income estimates.
Unsurprisingly, the stock is down 1.8% since reporting and currently trades at $62.25.
Is now the time to buy Triumph Financial? 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 12.1% since reporting. It currently trades at $122.99.
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 11.4% since the results and currently trades at $113.
Read our full analysis of Coastal Financial’s results here.
Regions Financial (NYSE: RF)
Tracing its roots back to 1971 and operating in a region known as the "heart of Dixie," Regions Financial (NYSE: RF) is a financial holding company that provides banking services, wealth management, and specialty financial solutions across the South, Midwest, and Texas.
Regions Financial reported revenues of $1.91 billion, up 10.1% year on year. This result topped analysts’ expectations by 2.9%. Overall, it was a strong quarter as it also recorded a solid beat of analysts’ net interest income estimates and a narrow beat of analysts’ tangible book value per share estimates.
The stock is up 11.6% since reporting and currently trades at $27.41.
Read our full, actionable report on Regions Financial here, it’s free.
Frost Bank (NYSE: CFR)
Tracing its roots back to 1868 when it was founded during Texas's post-Civil War reconstruction era, Cullen/Frost Bankers (NYSE: CFR) operates Frost Bank, a Texas-based financial institution providing commercial and consumer banking, wealth management, and insurance services.
Frost Bank reported revenues of $546.9 million, up 7.7% year on year. This print beat analysts’ expectations by 0.6%. It was a strong quarter as it also put up a solid beat of analysts’ tangible book value per share estimates and a decent beat of analysts’ net interest income estimates.
The stock is down 1.7% since reporting and currently trades at $131.94.
Read our full, actionable report on Frost Bank 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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