Core Insights - Bridgewater Bancshares, Inc. (BWB) operates in the banking sector, providing a range of financial services including commercial real estate loans, commercial loans, and deposit products [1] Performance Overview - Over the past 30 days, BWB has experienced a modest gain of approximately 0.78%, reflecting investor confidence and positive market sentiment [2][6] - Despite a recent decline of 2.63% over the last 10 days, this dip may present a strategic buying opportunity for investors [2] Growth Potential - BWB's stock price has significant growth potential, with an estimated increase of 21.89%, indicating that the stock is currently undervalued [3][6] - Analysts have set a target price of $23.50 for BWB, suggesting further room for appreciation in the stock [5] Financial Health - The company has a robust financial health, evidenced by a Piotroski Score of 8, which indicates strong financials, efficient operations, and a solid balance sheet [4][6]

Core Viewpoint - Bridgewater Bancshares, Inc. (BWB) is positioned as a strong investment opportunity due to its impressive recent performance, significant growth potential, and solid financial health indicators. Performance Summary - BWB has shown a 30-day gain of 5.72%, reflecting strong investor confidence and positive market sentiment [2][6] - Despite a short-term dip of 0.94% over the last 10 days, this may present a buying opportunity for investors [2] Growth Potential - The stock has a projected increase of 23.49%, indicating that BWB is currently undervalued and offers substantial upside for investors [3][6] - Analysts have set a target price of $23.50 for BWB, reinforcing confidence in the stock's growth potential [5] Financial Health - BWB holds a Piotroski Score of 8, suggesting that the company is fundamentally sound and well-prepared for future growth [4][6]

Disclaimer Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as "may", "might", "should", "could ...

Financial Data and Key Metrics Changes - The company finished the year strong with robust loan and core deposit growth, net interest margin expansion, and higher fee income [4] - Net interest margin expanded by 12 basis points to 2.75%, with net interest income increasing by 5% during the quarter [6][11] - Core deposits grew by 9% in the fourth quarter and 8% for the full year, while loans grew at an 11% pace [7] - Tangible book value per share grew 16.5% annualized and was up 15.3% year-over-year [7] Business Line Data and Key Metrics Changes - The company saw strong revenue growth from both spread and fee perspectives, with non-interest income bouncing back due to increases in swap fees and letter of credit fees [16] - Core deposit growth was driven by strong non-interest-bearing deposit growth, which increased by $100 million during the fourth quarter [18] - Loan balances were up 8.9% annualized in the fourth quarter and 11.4% for the year, with construction being the largest driver of growth [20][22] Market Data and Key Metrics Changes - The company is now the second-largest locally led bank in the Twin Cities, positioning itself well to capture market share amid M&A disruptions [9] - The multifamily portfolio continues to perform well, with only $62,000 in net charge-offs recorded since the bank's founding [23] - Non-performing assets increased modestly to 0.41% of assets, driven by isolated issues [24] Company Strategy and Development Direction - The company aims to optimize profitable growth while aligning loan growth with core deposit growth and expanding net interest margin [30] - There is a focus on gaining market share in the Twin Cities and expanding the affordable housing vertical both locally and nationally [31] - The company plans to leverage technology investments to support growth and organizational efficiencies, including a strategy around AI [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ability to continue driving net interest income growth and achieving a 3% net interest margin by the end of 2026 [12][29] - The company is monitoring the impact of recent events in the Twin Cities on team members and clients, emphasizing support for the community [9] - Management remains confident in the strength of the asset quality profile despite a modest uptick in non-performing assets and net charge-offs [7][24] Other Important Information - The company closed one of the two branches added through the First Minnetonka City Bank acquisition due to proximity to other branches, with minimal deposit attrition post-merger [8] - The company has a strong capital position, with a CET1 ratio increasing slightly from 9.08% to 9.17% [27] Q&A Session Summary Question: Can you unpack some of the deposit growth in the quarter? - Management noted that Q4 tends to be a seasonally high watermark for deposit growth, with a strong deposit pipeline overall [36][39] Question: Can you discuss the cadence of loan repricing? - Management indicated that loan repricing is well laid out and not concentrated in any one quarter, supporting the margin target [40][41] Question: What are the expectations for expenses in 2026? - Management expects expenses to grow in the high single digits, aligning with asset growth [42] Question: What is the company's appetite for potential acquisitions? - Management continues to engage in conversations with local bank owners and remains optimistic about future acquisition opportunities [55] Question: How does the company view the affordable housing vertical's growth potential? - Management expressed confidence in the affordable housing space, indicating it currently represents about 15% of the loan book and is expected to grow [59][60]

Financial Data and Key Metrics Changes - The company finished the year strong with robust loan and core deposit growth, net interest margin expansion, and higher fee income [4] - Net interest margin expanded by 12 basis points to 2.75%, with net interest income increasing by 5% during the quarter [6][11] - Core deposits grew by 9% in the fourth quarter and 8% for the full year, while loans grew at an 11% pace [7] - Tangible book value per share grew 16.5% annualized and was up 15.3% year-over-year [7] Business Line Data and Key Metrics Changes - The construction sector was the largest driver of loan growth, particularly in affordable housing, which saw a 27% annualized increase in the fourth quarter [22] - Non-interest income rebounded in the fourth quarter, driven by increases in swap fees and letter of credit fees [16] - The company reported a 9.5% annualized increase in expenses during the fourth quarter, aligning more closely with expected asset growth [17] Market Data and Key Metrics Changes - The company is now the second-largest locally led bank in the Twin Cities, positioning itself well amid M&A disruptions in the market [9] - Core deposit growth was strong, with an annualized growth of 8.8% in the fourth quarter [18] - Loan balances increased by 8.9% annualized in the fourth quarter and 11.4% for the year, indicating robust demand across the market [19] Company Strategy and Development Direction - The company aims to optimize profitable growth while aligning loan growth with core deposit growth and expanding net interest margin [30] - There is a focus on gaining market share in the Twin Cities and expanding expertise in targeted verticals such as nonprofits and SBA [31] - The company plans to enhance its affordable housing vertical and leverage technology investments to support growth and efficiency [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ability to continue driving net interest income growth and achieving a 3% net interest margin by the end of 2026 [12][29] - The company is monitoring the impact of recent events in the Twin Cities on team members and clients, emphasizing support for the community [9] - Management remains confident in the strength of the asset quality profile despite a modest uptick in non-performing assets and net charge-offs [24] Other Important Information - The company closed one of the two branches added through the First Minnetonka City Bank acquisition due to proximity to other branches, with minimal deposit attrition post-merger [8] - The CET1 ratio increased slightly from 9.08% to 9.17%, indicating a comfortable capital position [27] Q&A Session Summary Question: Can you unpack some of the deposit growth in the quarter? - Management noted that Q4 tends to be a seasonally high watermark for deposit growth, with expectations for modest growth in Q1 and Q2 [36][39] Question: What is the cadence of loan repricing? - Management indicated that loan repricing is well spread out, contributing to the target of achieving a 3% margin [40][41] Question: What are the expectations for expenses in 2026? - Management expects expenses to grow in line with asset growth, targeting high single-digit growth [42] Question: What is the company's appetite for potential acquisitions? - Management continues to engage with local bank owners for potential acquisitions but emphasizes organic growth as the primary focus [55] Question: How does the company view the affordable housing vertical's growth potential? - Management expressed confidence in the affordable housing space, indicating plans for continued growth without specific caps on size [59][60]

Financial Data and Key Metrics Changes - The company finished the year strong with robust loan and core deposit growth, net interest margin expansion, and higher fee income [4] - Net interest margin expanded by 12 basis points to 2.75%, driving strong growth in net interest income [5][11] - Core deposits grew by 9% in Q4 and 8% for the full year, while loans grew at an 11% pace, exceeding initial guidance [6] - Tangible book value per share grew 16.5% annualized and 15.3% year-over-year [7] Business Line Data and Key Metrics Changes - The company saw strong revenue growth from both spread and fee perspectives, with net interest income increasing by 5% during the quarter [11] - Non-interest income rebounded in Q4, driven by increases in swap fees and letter of credit fees [15] - Core deposit growth was 8.8% annualized in Q4, with significant growth in non-interest-bearing deposits [18] Market Data and Key Metrics Changes - The company is now the second-largest locally led bank in the Twin Cities, positioning itself well amid M&A disruptions in the market [9] - The affordable housing vertical saw a 27% annualized increase in balances in Q4, contributing significantly to loan growth [21] Company Strategy and Development Direction - The company aims to optimize profitable growth while aligning loan growth with core deposit growth and expanding net interest margin [30] - There is a focus on gaining market share in the Twin Cities and expanding expertise in targeted verticals, including nonprofits and SBA [31] - The company plans to continue expanding its affordable housing vertical and leverage technology investments for growth and efficiency [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ability to maintain loan growth in the high single digits in 2026, driven by strong core deposit growth [28] - The company expects to achieve a 3% net interest margin by the end of 2026, pulling forward previous expectations [28] - Management acknowledged the challenges in the operating environment but remains confident in the company's resilience and growth prospects [9] Other Important Information - The company closed one of the two branches added through the First Minnetonka City Bank acquisition due to proximity issues, with minimal deposit attrition post-merger [8] - The company is actively monitoring the impact of recent events in the Twin Cities on team members and clients [9] Q&A Session Summary Question: Can you unpack some of the deposit growth in the quarter? - Management noted that Q4 tends to be a seasonally high watermark for deposit growth, with expectations for modest growth in Q1 and Q2 [36] Question: Can you discuss the cadence of loan repricing? - Management indicated that loan repricing is well laid out and not concentrated in any one quarter, supporting the margin target [39] Question: What are the expectations for expenses in 2026? - Management expects expenses to grow in the high single digits, aligning with asset growth [42] Question: What is the company's appetite for potential acquisitions? - Management continues to engage with local bank owners and remains optimistic about future acquisition opportunities while focusing on organic growth [54] Question: How does the company view the affordable housing vertical's growth potential? - Management expressed confidence in the affordable housing space, expecting it to grow as a percentage of the overall loan book [59]

In addition to the results presented in accordance with U.S. General Accepted Accounting Principles ("GAAP"), the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company's operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures sho ...

Core Viewpoint - Bridgewater reported quarterly earnings of $0.44 per share, exceeding the Zacks Consensus Estimate of $0.42 per share, and showing an increase from $0.27 per share a year ago, indicating a positive earnings surprise of +6.02% [1] Financial Performance - The company achieved revenues of $38.84 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 1.93% and up from $29.5 million year-over-year [2] - Over the last four quarters, Bridgewater has exceeded consensus EPS estimates three times and has also topped consensus revenue estimates three times [2] Stock Performance - Bridgewater shares have increased approximately 4.7% since the beginning of the year, outperforming the S&P 500, which gained 1.5% [3] Future Outlook - The company's earnings outlook will be crucial for determining the stock's immediate price movement, with current consensus EPS estimates at $0.41 for the coming quarter and $1.80 for the current fiscal year [4][7] - The Zacks Rank for Bridgewater is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Banks - Northeast industry, to which Bridgewater belongs, is currently ranked in the top 22% of over 250 Zacks industries, suggesting a favorable environment for performance [8]

Financial Performance - Net income for Q4 2025 was $13.3 million, or $0.43 per diluted common share, compared to $11.6 million in Q3 2025 and $8.2 million in Q4 2024[4] - For the full year 2025, net income was $46.1 million, or $1.49 per diluted common share, compared to $1.03 in 2024[3] - Net Income for the year ended December 31, 2025, was $46,088,000, up from $32,825,000 in 2024, indicating a year-over-year growth of 40.5%[48] - Net income available to common shareholders for the three months ended December 31, 2025, was $12,320 thousand, reflecting a 16.4% increase from $10,588 thousand in the previous quarter[40] - The company reported a total net income of $13,334,000 for Q4 2025, up from $11,601,000 in Q3 2025[50] Income and Revenue - Net interest income increased by $1.6 million, or 4.7%, from Q3 2025, totaling $35.7 million for Q4 2025[10] - Noninterest income for Q4 2025 was $3.1 million, an increase of $1.1 million from Q3 2025 and $615,000 from Q4 2024[18] - Net interest income for Q4 2025 reached $35,687,000, an increase of 4.7% from $34,091,000 in Q3 2025 and up 33.5% from $26,967,000 in Q4 2024[36] - Noninterest income for the year ended December 31, 2025, totaled $10,915 thousand, an increase of 48.1% compared to $7,368 thousand for the year ended December 31, 2024[40] Assets and Liabilities - Total assets reached $5,438,555 thousand as of December 31, 2025, compared to $5,372,443 thousand at the end of the previous quarter[41] - Total liabilities increased to $4,889,907 thousand as of December 31, 2025, from $4,862,531 thousand in the previous quarter, reflecting a growth of 0.56%[39] - Total deposits reached $4.32 billion, an increase of $27.6 million or 2.6% annualized from Q3 2025, and up $233.6 million or 5.7% from Q4 2024[23] - Total gross loans increased to $4.31 billion, up $95.0 million or 8.9% annualized from Q3 2025, and up $441.0 million or 11.4% from Q4 2024[21] Efficiency and Ratios - The efficiency ratio improved to 51.6%, down from 54.7% in Q3 2025, indicating better cost management[3] - Return on Average Assets for Q4 2025 was 0.97%, up from 0.86% in Q3 2025[36] - Adjusted return on average assets improved to 0.99% in Q4 2025, up from 0.88% in Q3 2025[50] - The effective combined federal and state income tax rate was 22.2% in Q4 2025, down from 23.2% in Q3 2025[20] Credit Quality - Net loan charge-offs as a percentage of average loans increased to 0.04% from 0.03% in 2024[3] - The provision for credit losses on loans was $1.3 million in Q4 2025, compared to $900,000 in Q3 2025 and $1.5 million in Q4 2024[16] - Nonperforming Loans increased to $22,034,000 in Q4 2025, compared to $9,991,000 in Q3 2025, representing a significant rise[46] - The allowance for credit losses on loans to total loans was 1.31% at December 31, 2025, compared to 1.34% at September 30, 2025[20] Future Outlook and Strategy - The company plans to focus on profitable growth and market share expansion in 2026, particularly in affordable housing[6] - Future growth strategies may involve managing costs effectively and attracting key personnel[33] - The company acknowledges risks related to cybersecurity and technological changes impacting the financial services industry[33] - Forward-looking statements indicate potential risks including interest rate fluctuations and economic conditions affecting performance[31] Operational Highlights - The company operates eight strategically located branches, enhancing its service reach in Minnesota[29] - The company is committed to providing comprehensive banking solutions, including deposits, lending, and treasury management[29] - Bridgewater Bancshares has received numerous awards for its banking services and corporate culture, highlighting its market position[29] Shareholder Information - Tangible book value per share increased to $15.55 at December 31, 2025, a rise of $2.06, or 15.3%, from the previous year[3] - Total common shareholders' equity increased to $450,581 thousand in Q4 2025 from $430,949 thousand in Q3 2025[49] - Basic Earnings Per Share (EPS) for Q4 2025 was $0.45, up 18.4% from $0.38 in Q3 2025 and a 45.2% increase from $0.31 in Q4 2024[36]

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