Company Overview - OceanFirst Financial (OCFC) is anticipated to report a year-over-year earnings increase despite lower revenues for the quarter ended September 2024, with earnings expected at $0.38 per share, reflecting an 18.8% increase from the previous year [1][3] - Revenues are projected to be $92.79 million, which is an 8.8% decline compared to the same quarter last year [3] Earnings Expectations - The earnings report is scheduled for release on October 17, 2024, and could influence stock movement depending on whether the actual results exceed or fall short of expectations [2] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst expectations [4] Earnings Surprise Prediction - The Most Accurate Estimate for OceanFirst is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -1.96%, suggesting a bearish outlook from analysts [10] - The stock currently holds a Zacks Rank of 3 (Hold), complicating predictions of an earnings beat [11] Historical Performance - In the last reported quarter, OceanFirst was expected to post earnings of $0.42 per share but delivered $0.39, resulting in a surprise of -7.14% [12] - Over the past four quarters, the company has beaten consensus EPS estimates twice [13] Industry Context - Citizens Financial Group (CFG), a peer in the Zacks Financial - Savings and Loan industry, is expected to report earnings of $0.79 per share for the same quarter, indicating a year-over-year decline of 7.1% [17] - CFG's revenues are projected at $1.94 billion, down 3.8% from the previous year, with a recent EPS estimate revision of 1.2% lower [18]

Neosiam/iStock via Getty Images Introduction As it has been six months since my last article on OceanFirst Financial (NASDAQ:OCFC) was published, I figured this was a good moment to have another look at the preferred shares which are trading with (NASDAQ:OCFCP) as ticker symbol as another two quarters have passed. The smaller balance sheet and substantially higher CET1 ratio makes the bank (and its preferred shares) safer and although the earnings are relatively weak, I expect the net interest margin to imp ...

Financial Data and Key Metrics Changes - The company reported GAAP diluted earnings per share of $0.40 for Q2 2024, with net interest income decreasing to $82 million from $86 million in the prior quarter due to an inverted yield curve and elevated paydowns in higher-yielding loans [17][64]. - The common equity Tier 1 capital ratio increased to 11.2%, and tangible book value per share grew by 7% over the past year, reaching $18.93 [26][66]. - Noninterest expenses remained stable at $59 million, with a focus on maintaining operating expenses within the $58 million to $60 million range [35][88]. Business Line Data and Key Metrics Changes - The C&I loan balances were impacted by five borrowers who paid down or paid off loans totaling $86 million, while the loan pipeline increased to $259 million, the highest in the past five quarters [19][36]. - The company continues to pivot towards C&I lending relationships, with a recruitment of five new bankers and ongoing efforts to expand in the middle-market C&I and government contracting sectors [18][36]. Market Data and Key Metrics Changes - Deposit balances declined by approximately 2%, with nonmaturity deposits decreasing by 4% compared to the prior quarter, driven by a runoff of brokered CDs and a decline in high-yield savings balances [21]. - The company noted that the majority of activity continues to occur in its concentrated market between Philadelphia and New York, with measured growth in other regions such as Baltimore and Washington [12]. Company Strategy and Development Direction - The company is focused on organic growth in the second half of the year and into 2025, with a strategic shift towards C&I lending while methodically rebalancing its commercial loan portfolio [22][66]. - Management emphasized the importance of maintaining strong credit metrics and capital levels while being cautious about expanding risk appetites to stimulate short-term growth [65][66]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the loan growth expected in the second half of the year, despite the challenges posed by the inverted yield curve [56][66]. - The company is taking a proactive approach to building reserves in anticipation of potential economic uncertainties, while maintaining a strong asset quality with low nonperforming loans [49][175]. Other Important Information - The company has approved a quarterly cash dividend of $0.20 per common share, marking its 110th consecutive quarterly cash dividend [22]. - The bank is operating with minimal disruption despite external IT issues, ensuring customer access to all banking services [34]. Q&A Session Summary Question: What is the outlook for loan growth and margin? - Management anticipates significant increases in loan activity in Q3 and Q4, with a focus on high-quality client relationships despite potential margin compression [93][97]. Question: How is the company managing its capital and buyback strategy? - The company is prioritizing organic growth and will consider share repurchases if trading below tangible book value, but is currently focused on building its loan book [108][131]. Question: What is the company's strategy regarding CRE concentration? - Management aims to reduce CRE concentration over time while optimizing existing relationships, expecting the C&I proportion of the balance sheet to increase [102][125]. Question: How does the company view its asset quality and reserves? - The company maintains strong asset quality metrics and is gradually building reserves in response to external economic forecasts rather than internal credit quality indicators [25][175].

Core Insights - OceanFirst Financial (OCFC) reported revenue of $93.25 million for the quarter ended June 2024, reflecting a year-over-year decline of 7.7% and an EPS of $0.39 compared to $0.46 a year ago [5] - The reported revenue was below the Zacks Consensus Estimate of $94.93 million, resulting in a revenue surprise of -1.78% and an EPS surprise of -7.14% against a consensus estimate of $0.42 [1] - The company's stock has returned +26% over the past month, significantly outperforming the Zacks S&P 500 composite's +2.1% change, although it currently holds a Zacks Rank 4 (Sell), indicating potential underperformance in the near term [4] Financial Metrics - Efficiency Ratio was reported at 62.9%, slightly higher than the estimated 62% by analysts [3] - Net Interest Margin was 2.7%, below the estimated 2.8% [3] - Average Balance of Total Interest-Earning Assets was $12.20 billion, compared to the average estimate of $12.32 billion [3] - Total Non-Interest Income was $10.99 million, exceeding the estimated $9.39 million [3] - Net Interest Income was $82.26 million, lower than the average estimate of $85.22 million [3] - Bankcard services revenue was $1.57 million, above the estimated $1.22 million [3] - Fees and service charges reached $5.02 million, surpassing the estimated $4.74 million [3] - Trust and asset management revenue was $0.42 million, below the estimated $0.75 million [3] - Income from bank-owned life insurance was $1.73 million, slightly below the average estimate of $1.77 million [3]

This quarterly report represents an earnings surprise of -7.14%. A quarter ago, it was expected that this holding company for OceanFirst Bank would post earnings of $0.42 per share when it actually produced earnings of $0.44, delivering a surprise of 4.76%. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. While OceanFirst has underperformed the market so far t ...

Press Release RED BANK, NEW JERSEY, July 18, 2024 - OceanFirst Financial Corp. (NASDAQ:OCFC) (the "Company"), the holding company for OceanFirst Bank N.A. (the "Bank"), announced net income available to common stockholders of $23.4 million, or $0.40 per diluted share, for the three months ended June 30, 2024, a decrease from $26.8 million, or $0.45 per diluted share, for the corresponding prior year period, and $27.7 million, or $0.47 per diluted share, for the prior linked quarter. For the six months ended ...

Core Financial Performance - For the three months ended June 30, 2024, net income available to common stockholders was $23.4 million, or $0.40 per diluted share, a decrease from $26.8 million, or $0.45 per diluted share, for the same period last year [4] - Core earnings for the same period were $22.7 million, or $0.39 per diluted share, down from $27.2 million, or $0.46 per diluted share, in the prior year [5] - The company reported core earnings before income taxes and provision for credit losses (PTPP) of $32.7 million for the three months ended June 30, 2024, compared to $37.6 million for the same period last year [2] Asset Quality - Asset quality metrics remain strong, with criticized and classified assets at 1.42%, non-performing loans at 0.33%, and loans 30 to 89 days past due at 0.10% of total loans [2] - Non-performing loans increased to $30.6 million from $26.4 million, with the allowance for loan credit losses as a percentage of total non-performing loans at 225.10% [46] Capital and Shareholder Returns - The common equity tier 1 capital ratio was 11.2%, an increase of approximately 20 basis points from the prior linked quarter [2] - The company repurchased 338,087 shares totaling $5.0 million, with 1,638,524 shares remaining available for repurchase under the authorized program [2] Interest Income and Margin - Net interest income decreased to $82.3 million from $92.1 million, primarily due to the higher interest rate environment [9] - The net interest margin decreased to 2.71% from 3.02%, reflecting the impact of increased cost of funds [31] Operating Expenses - Operating expenses decreased to $58.6 million from $62.9 million, driven by reductions in professional fees and compensation expenses [16] - Total operating expenses for the six months ended June 30, 2024, were $117.3 million, down from $124.2 million in the prior year [17] Tax and Effective Tax Rate - The provision for income taxes was $7.1 million for the three months ended June 30, 2024, compared to $9.0 million for the same period last year [19] - The effective tax rate was 22.5% for the current quarter, down from 24.4% in the prior year [19] Balance Sheet and Asset Management - Total assets decreased by $216.5 million to $13.32 billion, primarily due to decreases in loans and debt securities [20] - Average interest-earning assets decreased by $46.3 million, while the average yield for interest-earning assets increased to 5.25% from 4.91% [10]

Core Viewpoint - The sustainability of immediate price changes and future earnings expectations will largely depend on management's discussion during the earnings call, with a focus on the potential for a positive EPS surprise [1] Company Overview: OceanFirst - OceanFirst is expected to report revenues of $94.93 million, reflecting a decline of 6.1% compared to the same quarter last year [2] - The Most Accurate Estimate for OceanFirst is higher than the Zacks Consensus Estimate, indicating a recent bullish sentiment among analysts, resulting in an Earnings ESP of +0.20% [5] - For the last reported quarter, OceanFirst's actual earnings were $0.44 per share, surpassing the expected $0.42, leading to a surprise of +4.76% [6] - The consensus EPS estimate for OceanFirst has been revised down by 3.08% over the last 30 days, indicating a reassessment by covering analysts [15] - OceanFirst currently holds a Zacks Rank of 4, suggesting a less favorable outlook [24] Industry Context: Citizens Financial Group - Citizens Financial Group is projected to post earnings of $0.79 per share for the quarter ended June 2024, which represents a year-over-year decline of 14.1% [12] - Revenues for Citizens Financial Group are expected to be $1.95 billion, down 6.9% from the previous year [12] - The consensus EPS estimate for Citizens Financial Group has been revised up by 0.7% over the last 30 days, with an Earnings ESP of 0.75% [20] - Citizens Financial Group has not beaten consensus EPS estimates in any of the last four quarters [30] Earnings Prediction Insights - A positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3, with historical data showing a nearly 70% success rate for this combination [9] - The predictive power of the Earnings ESP model is significant primarily for positive readings [23] - Despite a positive Earnings ESP, OceanFirst's combination with a Zacks Rank of 4 makes it difficult to predict a consensus EPS beat conclusively [10]

RED BANK, N.J., June 24, 2024 (GLOBE NEWSWIRE) -- OceanFirst Financial Corp. (NASDAQ:OCFC), the holding company for OceanFirst Bank, today announced that it will issue its earnings release for the quarter ended June 30, 2024 on Thursday, July 18, 2024 after market close. Management will then conduct a conference call at 11:00 a.m. Eastern Time, on Friday, July 19, 2024 to discuss highlights of the Company's quarterly operating performance. OceanFirst Financial Corp.'s press releases are available at http:// ...

The conference call will also be available (listen-only) by accessing the Company's Web address: www.oceanfirst.com – Investor Relations. Web users should go to the site at least fifteen minutes prior to the call to register, download, and install any necessary audio software. The webcast will be available for at least 30 days. In addition to historical information, this news release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 which ...