Core Insights - Huntington Bancshares Incorporated reported strong financial performance with earnings per share (EPS) of $0.41, exceeding estimates and showing a year-over-year improvement [2] - The company achieved revenue of approximately $2.15 billion, surpassing estimates and reflecting significant growth compared to the previous year [3] - Net income reached $629 million, indicating a robust increase driven by higher interest income and strong loan growth [4] Financial Performance - EPS of $0.41, up from $0.33 a year ago, represents a positive earnings surprise of +5.26% [2] - Revenue of $2.15 billion reflects a 4.55% increase over estimates and a rise from $1.89 billion in the same quarter last year [3] - Net income increased by 17% from the previous quarter and 22% from the same period last year [4] Financial Metrics - Price-to-earnings (P/E) ratio is approximately 10.70, indicating favorable market valuation [5] - Price-to-sales ratio is about 1.86, and enterprise value to sales ratio is around 2.44, suggesting efficient revenue generation [5] - Debt-to-equity ratio of approximately 0.86 indicates a moderate level of debt [5]

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Core Insights - Huntington Bancshares Incorporated (HBAN) reported third-quarter 2025 adjusted earnings per share (EPS) of 40 cents, exceeding the Zacks Consensus Estimate of 38 cents and up from 33 cents in the prior-year quarter [1][9] - The results were driven by improvements in net interest income (NII) and non-interest income, alongside increases in loan and deposit balances, although higher non-interest expenses posed challenges [1][3] Financial Performance - Total quarterly revenues increased 13.9% year over year to $2.15 billion, surpassing the Zacks Consensus Estimate of $2.06 billion [3] - NII on a fully taxable-equivalent (FTE) basis was $1.52 billion, up 11.6% from the prior-year quarter, attributed to a rise in average earning assets and net interest margin (NIM), which increased by 15 basis points to 3.13% [3][4] - Non-interest income rose 20.1% year over year to $628 million, while non-interest expenses increased 10.3% to $1.24 billion, primarily due to higher costs across most components [4] Loan and Deposit Growth - As of September 30, 2025, average loans and leases increased 2.1% sequentially to $135.9 billion, and average total deposits rose nearly 1% to $164.8 billion [5] Credit Quality - Net charge-offs decreased to $75 million from $93 million in the prior-year quarter, while the allowance for credit losses increased 5.2% to $2.56 billion [6] - Total non-performing assets rose 4.7% year over year to $821 million, with net charge-offs as a percentage of average total loans and leases declining to 0.22% from 0.30% [6][7] Capital Ratios - The common equity tier 1 risk-based capital ratio improved to 10.6% from 10.4% in the year-ago period, while the regulatory Tier 1 risk-based capital ratio increased to 12.4% from 12.1% [8][10] Strategic Outlook - The company's inorganic expansion strategies are expected to enhance revenue growth in the near term, with efforts to expand commercial banking capabilities and increase presence in key growth markets such as North Carolina, South Carolina, and Texas [11]

Core Insights - BAD BEAT Investing, led by Quad 7 Capital, is a team of 7 analysts with nearly 12 years of experience in identifying investment opportunities [1] - The firm is recognized for its February 2020 recommendation to sell everything and go short, maintaining an average position of 95% long and 5% short since May 2020 [1] - The company emphasizes teaching investors to become proficient traders through a structured playbook, focusing on short- and medium-term investments, income generation, special situations, and momentum trades [1] Company Overview - Quad 7 Capital has expertise across various fields including business, policy, economics, mathematics, game theory, and sciences [1] - The firm shares both long and short trades and invests personally in equities discussed within their investing group [1] - The goal of BAD BEAT Investing is to provide in-depth, high-quality research with clear entry and exit targets to save investors time [1] Benefits of BAD BEAT Investing - Investors can learn to understand market dynamics and execute well-researched trade ideas weekly [2] - The service includes access to 4 chat rooms and daily summaries of key analyst upgrades and downgrades [2] - Participants can learn basic options trading and utilize extensive trading tools [2]

Core Insights - Investor fears regarding worsening credit conditions eased as regional bank earnings provided relief after a significant market downturn [1][2] - The KBW regional bank index rose after a sharp decline of 6% on Thursday, marking its worst single-day pullback since April [1] Group 1: Regional Bank Earnings - Investors reacted positively to earnings reports from regional banks such as Truist Financial, Fifth Third Bancorp, Huntington Bancshares, and Ally Financial, with most stocks rising in early trading [2] - Loan loss provisions were lower than analysts' expectations for most banks, except for Huntington [2] Group 2: Credit Quality and Risks - Trust CEO Bill Rogers stated that overall credit quality remains strong, despite some idiosyncratic events in the market [3] - The scrutiny of regional banks increased after Western Alliance and Zions disclosed bad loans linked to fraud, causing significant stock declines [4] - Concerns were heightened by recent bankruptcies in the auto lending sector, with Fifth Third reporting a $200 million increase in net charge-offs compared to the previous quarter [6] Group 3: Market Reactions - Stocks of Western Alliance and Zions recovered on Friday after their initial declines, along with Jefferies Financial, which was affected by an auto parts supplier's bankruptcy [4] - Investors in the sector tend to react quickly to credit concerns, often selling first and asking questions later [5]

Group 1 - Regional banks are facing challenges due to some smaller banks recording higher-than-expected loan loss provisions, impacting the sector negatively [1] - Despite the difficulties in the sector, some banks reported positive earnings results, indicating not all are affected equally [1] Group 2 - The investment group European Small Cap Ideas focuses on high-quality small-cap investment opportunities in Europe, emphasizing capital gains and dividend income [1] - The group offers two model portfolios: the European Small Cap Ideas portfolio and the European REIT Portfolio, along with weekly updates and educational content [1]

Credit Risk & Portfolio Performance - Huntington Bank shares reported better-than-expected quarter with upbeat guidance, providing some relief to the market focused on credit quality [1] - The bank is very comfortable with its credit risk, operating under a moderate to low-risk appetite for 15 years [3] - Charge-offs this quarter were 22 basis points (022%), with non-performers and delinquency reduced [3] - The bank is confident in its portfolio performance due to controls, diversification, and portfolio management [4] - The bank views concerns about credit risk as one-offs and not systemic, believing banks have diversified risk and managed it better since the great financial recession [4][5] Lending & Consumer Outlook - The bank is optimistic about loan growth, experiencing high 8+% loan growth for the year and expects to continue that [6] - Low to moderate-income consumers are feeling the stress from inflation, while the balance of consumers are in great shape [7][8] Financial Performance & Strategy - The bank has raised its 2025 net interest income guidance due to peer-leading deposit and loan growth [8][9] - The reduction in short-term interest rates by the Fed is widening the bank's net interest margin by a couple of basis points with every reduction [9][10] - The bank is closing on a combination with Veritex and is focused on driving core growth, having increased guidance each quarter this year [11][12] - The bank has invested significantly, expanding into North and South Carolina, opening branches, and establishing specialty banking groups nationally, focusing on organic growth [14] - The bank views the Veritex combination in Texas as a springboard for organic opportunity [15]

Core Viewpoint - Regional banks are experiencing a rebound in share prices, with positive earnings reports providing relief amid concerns about credit quality [1] Company Performance - Huntington Bank reported better-than-expected quarterly results and provided upbeat guidance, indicating strong performance [1] - The company maintains a moderate to low risk appetite established 15 years ago, resulting in consistently strong results, with charge-offs at 22 basis points and a reduction in non-performing loans and delinquencies [3][5] - The company is optimistic about loan growth, projecting over 8% growth for the year [6] Consumer and Business Outlook - The consumer landscape is mixed, with low to moderate-income consumers facing stress from inflation, while the majority of consumers are in good shape [7][8] - The company has seen peer-leading deposit and loan growth, contributing to a widening net interest margin due to recent Fed interest rate cuts [9] Market Position and Strategy - The stock has been relatively flat over the year, with a recent decline of 8% over three months, attributed to market sorting between buyers and sellers [10] - The company is focused on core growth and has consistently raised guidance each quarter, indicating confidence in future performance [12] - The regulatory environment has changed, leading to expectations of more bank deals, with the company recently closing a significant combination with Veritex [13][14] Growth Initiatives - The company has expanded into new markets, including North and South Carolina, and plans to open several branches in the coming years [14] - The focus remains on organic growth rather than acquisitions, with a strong emphasis on driving performance through existing operations [15][16]

Core Insights - Huntington Bancshares reported a revenue of $2.15 billion for the quarter ended September 2025, marking a 14% increase year-over-year and exceeding the Zacks Consensus Estimate of $2.06 billion by 4.55% [1] - The company's earnings per share (EPS) was $0.40, up from $0.33 in the same quarter last year, also surpassing the consensus EPS estimate of $0.38 by 5.26% [1] Financial Performance Metrics - Efficiency Ratio stood at 57.4%, better than the five-analyst average estimate of 59.1% [4] - Net Interest Margin (FTE) was reported at 3.1%, matching the average estimate [4] - Net charge-offs as a percentage of average total loans and leases were 0.2%, lower than the five-analyst average estimate of 0.3% [4] - Average Balance of Total earning assets was $192.73 billion, slightly above the estimated $192.13 billion [4] - Tier 1 Leverage Ratio was 9%, exceeding the average estimate of 8.7% [4] - Regulatory Tier 1 risk-based capital ratio was 12.4%, compared to the average estimate of 12.2% [4] - Net interest income (FTE) reached $1.52 billion, surpassing the average estimate of $1.5 billion [4] - Total Non-Interest Income was $628 million, exceeding the estimated $555.07 million [4] - Capital markets and advisory fees amounted to $94 million, slightly above the average estimate of $93.27 million [4] - Customer deposit and loan fees were $102 million, higher than the average estimate of $96.55 million [4] - Payments and cash management revenue reached $174 million, exceeding the average estimate of $169.05 million [4] - Wealth and asset management revenue was $104 million, slightly above the average estimate of $103.78 million [4] Stock Performance - Shares of Huntington Bancshares have declined by 14% over the past month, while the Zacks S&P 500 composite increased by 0.7% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - The company reported earnings per common share of $0.41, with an adjusted EPS of $0.40, reflecting an 18% year-over-year increase [9] - Revenue grew by 14% year-over-year, adjusted PP&R increased by 16%, and tangible book value rose by 10% [5][9] - Average loan balances grew by $2.8 billion, or 2% from the prior quarter, while average deposits increased by $1.4 billion, or 1% [9][10] - Reported CET1 ended the quarter at 10.6%, with adjusted CET1 at 9.2%, up 30 basis points from last year [9] Business Line Data and Key Metrics Changes - Loan growth accelerated to 9.2% year-over-year, driven by commercial lending and new initiatives contributing $1.2 billion, or approximately 40% of total loan growth [10] - Key drivers of loan growth included geographic expansion in Texas and the Carolinas, with significant contributions from corporate and specialty banking, auto, and regional banking [10] - Non-interest income increased by 14%, or $75 million year-over-year, with strong performance in payments, wealth management, and capital markets [12][13] Market Data and Key Metrics Changes - The company is poised to become the 14th largest depository in Texas and the fifth largest in Dallas following the acquisition of Veritechs [6] - The company expects to achieve full-year ADB growth of approximately 9% to 9.5% inclusive of Veritechs, with deposits expected to grow approximately 6.5% to 7% [18] Company Strategy and Development Direction - The company continues to execute its growth strategy with a focus on organic growth and investment in local market relationships [4][5] - The acquisition of Veritechs is seen as a springboard for growth in Texas, with expectations of cost and revenue synergies [6][8] - The company plans to expand its branch network in Texas and enhance its commercial banking activities [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage risks and maintain strong credit quality despite economic uncertainties [30][56] - The company is raising its financial guidance for the year, expecting strong loan growth and improved net interest income [17][18] - Management anticipates continued strong performance in 2026, with expectations of mid to high single-digit loan growth [29] Other Important Information - The company completed a preferred issuance in the third quarter, which will result in higher preferred dividends in the fourth quarter [22] - The company has a disciplined approach to capital management, focusing on funding high-return loan growth and supporting a strong dividend yield [19] Q&A Session Summary Question: Can you talk about the loan growth outlook and pipelines? - Management indicated strong momentum in loan growth, with expectations of approximately 1.5% sequential growth in the fourth quarter [27][28] Question: What are the safeguards against credit quality issues? - Management emphasized their moderate to low risk appetite and active portfolio management to mitigate risks [36][37] Question: How do you see operating leverage trending? - Management noted a significant improvement in operating leverage, now expected to exceed 2.5% for the year [44][45] Question: Can you discuss the competitive landscape for deposits? - Management highlighted their sophisticated approach to managing deposit activities, which has led to strong performance in both rate and volume [60][61] Question: What is the outlook for asset finance lending? - Management expects a solid fourth quarter for asset finance, setting up for a strong year in 2026 [70]