Core Viewpoint - Bridgewater (BWB) is positioned as a strong investment opportunity due to significant revisions in earnings estimates, indicating a positive earnings outlook and potential for continued stock price gains [1][2]. Current-Quarter Estimate Revisions - The expected earnings for the current quarter are $0.29 per share, reflecting a year-over-year increase of +20.83% - Over the past 30 days, there has been one upward revision in estimates with no negative changes, leading to a 5.56% increase in the Zacks Consensus Estimate [4]. Current-Year Estimate Revisions - For the full year, the earnings estimate stands at $1.38 per share, representing a year-over-year change of +31.43% - Similar to the current quarter, there has been one upward revision in estimates over the past month, resulting in an 11.34% increase in the consensus estimate [5]. Favorable Zacks Rank - The positive revisions in earnings estimates have earned Bridgewater a Zacks Rank 1 (Strong Buy), indicating strong potential for outperformance - Historically, stocks with a Zacks Rank 1 and 2 have significantly outperformed the S&P 500 [6]. Bottom Line - Investors are increasingly optimistic about Bridgewater due to its solid estimate revisions, as evidenced by a 9.4% stock gain over the past four weeks, suggesting it may be a timely addition to investment portfolios [7].

Core Insights - The focus is on income investing through common shares, preferred shares, or bonds, with occasional analysis of the broader economy or specific company situations [1] - The author has a background in history, political science, and an MBA with a specialization in Finance and Economics, indicating a strong analytical foundation [1] Company and Industry Summary - The article mentions a beneficial long position in BWBBP shares, indicating a positive outlook on this specific investment [2] - The author emphasizes that the article reflects personal opinions and is not influenced by any business relationships with mentioned companies [2] - There is a disclaimer regarding past performance not guaranteeing future results, highlighting the importance of independent analysis in investment decisions [3]

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 ...

Core Viewpoint - Bridgewater (BWB) reported quarterly earnings of $0.27 per share, exceeding the Zacks Consensus Estimate of $0.22 per share, but down from $0.28 per share a year ago, indicating a 22.73% earnings surprise [1][2] Financial Performance - The company achieved revenues of $29.5 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 6.12%, compared to $26.72 million in the same quarter last year [2] - Over the last four quarters, Bridgewater has exceeded consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance - Since the beginning of the year, Bridgewater shares have increased by approximately 1.1%, while the S&P 500 has gained 3.2% [3] - The current consensus EPS estimate for the upcoming quarter is $0.27 on revenues of $30.1 million, and for the current fiscal year, it is $1.24 on revenues of $128.6 million [7] Earnings Outlook - The estimate revisions trend for Bridgewater is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] - The outlook for the industry, specifically the Banks - Northeast sector, is favorable, ranking in the top 9% of over 250 Zacks industries, suggesting potential positive impacts on stock performance [8]

Financial Performance - Net income for Q4 2024 was $8.2 million, or $0.26 per diluted common share, a decrease from $8.7 million in Q3 2024[4] - Net income available to common shareholders decreased to $7,190,000 in Q4 2024, down 6.1% from $7,662,000 in Q3 2024[40] - Net income for Q4 2024 was $8,204,000, slightly down from $8,675,000 in Q3 2024, with total net income for the year at $32,825,000 compared to $39,960,000 in 2023[52] - The company reported an income before income taxes of $10,513,000 for Q4 2024, down from $11,233,000 in Q4 2023, a decrease of 6.4%[45] Deposits and Loans - Core deposits increased by $428.2 million, or 63.6% annualized, from Q3 2024; excluding the acquisition of First Minnetonka City Bank (FMCB), core deposits increased by $210.9 million, or 31.3% annualized[3] - Total deposits increased by $376.8 million, or 10.2%, in 2024; core deposits increased by $559.4 million, or 22.0%[3] - Gross loans increased by $182.9 million, or 19.7% annualized, from Q3 2024; excluding FMCB, gross loans increased by $65.8 million, or 7.1% annualized[3] - Total gross loans reached $3.87 billion in Q4 2024, a 5.0% increase from $3.69 billion in Q3 2024 and a 3.9% increase from $3.72 billion in Q4 2023[22] - Total deposits were $4.09 billion in Q4 2024, an increase of 9.1% from $3.75 billion in Q3 2024 and 10.2% from $3.71 billion in Q4 2023[23] - The loan-to-deposit ratio improved to 94.7%, down from 100.4% at the end of 2023[3] Interest Income and Expenses - Net interest income for Q4 2024 was $27.0 million, an increase of $1.4 million from Q3 2024[10] - Interest expense on deposits decreased to $32.8 million in Q4 2024, down from $34.2 million in Q3 2024, but up from $29.4 million in Q4 2023[15] - Total interest income for Q4 2024 reached $63,324,000, an increase from $58,669,000 in Q4 2023, representing an 8.8% year-over-year growth[45] - The cost of total deposits was 3.40% in Q4 2024, a decrease from 3.58% in Q3 2024[40] Asset Quality - Nonperforming assets to total assets ratio was 0.01% for the year ended December 31, 2024, compared to 0.02% at the end of 2023[3] - Nonperforming assets totaled $301,000, or 0.01% of total assets, at December 31, 2024, compared to $8.8 million, or 0.19% at September 30, 2024[31] - Nonperforming loans decreased to $301,000 in Q4 2024 from $8,378,000 in Q3 2024, indicating improved asset quality[50] Capital and Equity - Total shareholders' equity rose to $457.9 million in Q4 2024, a 1.3% increase from $452.2 million in Q3 2024 and a 7.6% increase from $425.5 million in Q4 2023[29] - The Common Equity Tier 1 Risk-Based Capital Ratio was 9.08% at December 31, 2024, down from 9.79% at September 30, 2024[31] - Tangible common equity as a percentage of tangible assets was 7.36% at December 31, 2024, compared to 8.17% at September 30, 2024[31] Operational Efficiency - The efficiency ratio improved to 56.8% in Q4 2024, down from 58.0% in Q3 2024 and 58.8% in Q4 2023[21] - Adjusted Efficiency Ratio improved to 55.2% in Q4 2024 from 57.2% in Q3 2024, reflecting better operational efficiency[52] Future Outlook - The Company will host a conference call on January 30, 2025, to discuss its Q4 2024 financial results[33] - The Company had $15.3 million remaining under its current share repurchase authorization as of December 31, 2024[31]

Merger and Acquisition - The Company announced a definitive merger agreement to acquire First Minnetonka City Bank in an all-cash transaction [147]. - The acquisition is expected to close in Q4 2024, with the combined organization projected to have approximately $4.9 billion in total assets, $4.0 billion in deposits, and $3.9 billion in loans and leases [148]. - The Company has received all necessary regulatory approvals for the merger transaction [148]. - The merger will result in nine full-service branches across the Twin Cities [148]. Financial Performance - Net Interest Income for September 30, 2024, was $25,599,000, an increase from $25,421,000 for September 30, 2023, representing a growth of 0.7% year-over-year [151]. - Net Income for the quarter ended September 30, 2024, was $8,675,000, compared to $9,629,000 for the same period last year, reflecting a decrease of 9.9% [151]. - Basic Earnings Per Share (EPS) increased to $0.28 for September 30, 2024, up from $0.31 for September 30, 2023, a decline of 9.7% [151]. - Total Assets as of September 30, 2024, were $4,691,517,000, slightly up from $4,557,070,000 a year earlier, indicating a growth of 2.9% [151]. - Total Loans, Gross, decreased to $3,685,590,000 from $3,722,271,000 year-over-year, a decline of 1.0% [151]. - Total Shareholders' Equity increased to $452,200,000 from $415,960,000, showing a growth of 8.7% year-over-year [151]. - Return on Average Assets improved to 0.73% for the quarter, compared to 0.85% for the same quarter last year [151]. - Return on Average Shareholders' Equity was 7.79% for September 30, 2024, up from 9.23% a year ago, indicating a decrease in profitability [151]. Credit Quality and Risk Management - The Company emphasizes the importance of managing credit risk and maintaining an adequate level of allowance for credit losses on loans [142]. - Nonperforming loans increased to $8.4 million, representing 0.23% of total loans, compared to $0.02% in the previous year [152]. - The allowance for credit losses on loans to nonaccrual loans was 608.95% [156]. - The allowance for credit losses was $51,018 thousand, reflecting a focus on maintaining asset quality [212][219]. - The Company emphasizes credit quality, with a focus on managing classified and nonperforming assets [219]. - The Company acknowledges the inherent uncertainties and risks associated with forward-looking statements regarding future performance [144]. Deposits and Liquidity - Total deposits as of September 30, 2024, were $3.75 billion, an increase of $37.5 million, or 1.0%, compared to $3.71 billion at December 31, 2023 [233]. - Core deposits increased by $131.2 million, or 6.9% annualized, from December 31, 2023, primarily due to increased balances from existing clients and new client acquisitions [233]. - Total brokered deposits decreased by $123.5 million to $901.0 million as of September 30, 2024, compared to $1.02 billion at December 31, 2023 [235]. - The ratio of Primary Liquidity to Total Deposits improved to 18.3% as of September 30, 2024, compared to 14.3% at December 31, 2023 [258]. Interest Rate Risk Management - The Company has a total notional amount of $308.0 million in cash flow hedges as of September 30, 2024, aimed at managing interest rate exposure [271]. - In a scenario of a 400 basis point increase in interest rates, the Company would experience a 6.58% decrease in net interest income as of September 30, 2024 [275]. - The Company anticipates a potential 11.10% increase in net interest income with an immediate 300 basis point decrease in interest rates [275]. - The Company’s risk management infrastructure includes limits and management targets for net interest income simulation, ensuring proactive interest rate risk management [268]. - The Company does not engage in speculative trading activities related to interest rates, foreign exchange rates, or commodities, focusing instead on risk management [269]. Operational Efficiency - The efficiency ratio for Q3 2024 was 58.0%, compared to 56.1% for Q3 2023, indicating a decline in operational efficiency [199]. - The Company reported a Tangible Common Equity of $382,897,000 as of September 30, 2024, compared to $369,930,000 as of June 30, 2024, an increase of 3.4% [266]. - The Efficiency Ratio for September 30, 2024, improved to 58.0% from 58.7% for June 30, 2024, reflecting enhanced operational efficiency [266].

Financial Data and Key Metrics Changes - The company reported earnings of $0.27 per share for Q3 2024, marking a solid quarter with net interest income growth for the second consecutive quarter and stable net interest margin at 2.24% [6][7][12] - Tangible book value increased by 3% in Q3, marking the 31st consecutive quarter of growth [10] - Capital ratios improved, with CET1 increasing from 9.41% to 9.79% [28] Business Line Data and Key Metrics Changes - Core deposit growth was strong, with an increase of $93 million or 14.4% annualized, contributing to an improved deposit mix [17] - Loan balances decreased by $115 million due to elevated loan payoffs, with total payoffs up 42% year-to-date compared to 2023 [18][21] - The loan-to-deposit ratio improved to 98.3% from 99.8% in the previous quarter [18] Market Data and Key Metrics Changes - The multifamily exposure of $1.4 billion showed only $62,000 in net charge-offs since inception, indicating strong asset quality [23][26] - Vacancy rates in the Twin Cities for multifamily properties have declined, reflecting robust demand and a slowdown in construction [23] Company Strategy and Development Direction - The acquisition of First Minnetonka City Bank is expected to enhance liquidity and reduce commercial real estate concentration while adding a new income stream [8][9] - The company aims to optimize its balance sheet for long-term growth, focusing on core deposit growth and strategic M&A opportunities [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about margin expansion beginning in Q4 2024, driven by a liability-sensitive balance sheet and the recent Fed rate cut [7][29] - The company remains focused on generating profitable growth while adhering to a conservative credit culture, despite expected elevated loan payoffs [21] Other Important Information - The company has made recent enhancements to its leadership structure to increase agility and focus [11] - The integration of First Minnetonka City Bank is on track, with all required regulatory approvals received [9] Q&A Session Summary Question: Details on loan payoffs - Management indicated that payoffs were a mix of credit-driven and customer-driven decisions, with expectations for continued elevated payoffs in Q4 [32][34] Question: Margin and deposit runoff timing - The brokered deposit runoff occurred from mid-August to early September, with costs above 5%, benefiting the margin [35][36] Question: Expense growth relative to asset growth - Management expects expenses to track in line with asset growth, maintaining a mid-single-digit growth rate [37][38] Question: Loan growth outlook for next year - The company anticipates mid-single-digit loan growth in 2025, supported by a strong pipeline [45] Question: Margin outlook and Fed rate cuts - The modest margin expansion outlook is influenced by the pace of Fed rate cuts and competitive deposit pricing in the market [50][51] Question: Regulatory feedback on commercial real estate concentration - Management reported positive feedback from regulators, indicating effective risk management practices [54] Question: Share repurchase plans post-acquisition - The company will evaluate share repurchase opportunities based on capital levels and growth opportunities, aiming to maintain CET1 above 9% [55]

EARNINGS PRESENTATION THIRD QUARTER 2024 Bridgewater Bancshares Inc. 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 ...

Core Viewpoint - The article emphasizes the importance of identifying and sustaining stock price trends for successful short-term investing, highlighting the utility of a "Recent Price Strength" screen to find stocks with strong fundamentals and upward momentum [1]. Group 1: Stock Performance - Bridgewater (BWB) has shown a solid price increase of 10% over the past 12 weeks, indicating investor confidence in its potential upside [2]. - The stock has also increased by 8.1% over the last four weeks, suggesting that the upward trend is still intact [2]. - BWB is currently trading at 93.7% of its 52-week high-low range, indicating a potential breakout [2]. Group 2: Fundamental Strength - BWB holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [3]. - The Zacks Rank system has a strong historical performance, with Rank 1 stocks generating an average annual return of +25% since 1988 [3]. - The Average Broker Recommendation for BWB is also 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [3]. Group 3: Investment Strategy - The article suggests that BWB's price trend is unlikely to reverse soon, and encourages investors to explore other stocks that meet the "Recent Price Strength" criteria [4]. - It mentions the availability of over 45 Zacks Premium Screens tailored to different investing styles, which can help identify potential winning stocks [4]. - The Zacks Research Wizard tool is recommended for backtesting stock-picking strategies to ensure past profitability [4].

Company Performance - Bridgewater reported quarterly earnings of $0.27 per share, exceeding the Zacks Consensus Estimate of $0.25 per share, but down from $0.30 per share a year ago, representing an earnings surprise of 8% [1] - The company posted revenues of $27.12 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 0.08%, and slightly down from $27.15 million year-over-year [1] - Over the last four quarters, Bridgewater has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [1] Stock Outlook - The stock has added approximately 11.4% since the beginning of the year, compared to the S&P 500's gain of 22.7% [2] - The current consensus EPS estimate for the upcoming quarter is $0.27 on revenues of $28.6 million, and for the current fiscal year, it is $1.01 on revenues of $109 million [4] - The estimate revisions trend for Bridgewater is currently favorable, resulting in a Zacks Rank 1 (Strong Buy) for the stock, indicating expected outperformance in the near future [4] Industry Context - The Banks - Northeast industry, to which Bridgewater belongs, is currently in the top 20% of over 250 Zacks industries, suggesting a positive outlook for stocks within this sector [5] - Empirical research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 [5] - BM Technologies, Inc. (BMTX), another company in the same industry, is expected to report a quarterly loss of $0.18 per share, reflecting a year-over-year change of +47.1%, with revenues projected at $14.06 million, down 4.6% from the previous year [5]