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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, in ...

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PresentationJared David ShawMD & Senior Equity Research Analyst Great. Well, thanks, everybody. Good morning. Thanks for joining us for the first mid-cap bank fireside chat. We're pleased to have Webster Financial and John Ciulla, CEO. We hope this could be a little interactive as well. So we'll have a few questions for the audience that you can use your BlackBerry there to respond. And then also if you have any questions yourself, there will be an opportunity to raise your hand and ask questions. But maybe ...

Webster Financial (NYSE:WBS) FY Conference September 08, 2025 09:45 AM ET Unknown Speakertextnumber_of_speakersparagraphs ...

Core Viewpoint - The article emphasizes the importance of value investing and highlights Webster Financial (WBS) as a strong value stock based on its financial metrics and Zacks Rank [1][2][6]. Group 1: Value Investing - Value investing is a popular strategy that utilizes fundamental analysis and traditional valuation metrics to identify undervalued stocks [2]. - Zacks has developed a Style Scores system to categorize stocks, with a specific focus on the "Value" category for value investors [3]. Group 2: Webster Financial (WBS) - Webster Financial (WBS) currently holds a Zacks Rank 2 (Buy) and an A grade for Value, indicating strong potential [4]. - WBS has a Forward P/E ratio of 9.3, which is lower than the industry average of 9.77, suggesting it may be undervalued [4]. - Over the past year, WBS's Forward P/E has fluctuated between 7.00 and 11.14, with a median of 8.95 [4]. - The stock has a P/CF ratio of 10.84, which is attractive compared to the industry's average P/CF of 15.10, indicating a favorable cash flow outlook [5]. - WBS's P/CF has ranged from 8.07 to 12.64 over the past 52 weeks, with a median of 10.76 [5]. - Overall, the financial metrics suggest that Webster Financial is likely undervalued and stands out as one of the strongest value stocks in the market [6].

[PART I – FINANCIAL INFORMATION](index=7&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=7&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Webster Financial Corporation reported total consolidated assets of approximately $82 billion as of June 30, 2025, with net income increasing to $258.8 million in Q2 2025, driven by higher net interest income and a positive swing in non-interest income. - Webster Financial Corporation is a bank holding company with approximately **$82 billion in total consolidated assets** as of June 30, 2025, operating through Commercial Banking, Healthcare Financial Services, and Consumer Banking[17](index=17&type=chunk) - Management believes the company's diverse business, strong capital, and risk management framework position it to operate effectively despite economic uncertainty from potential changes in U.S. trade policies and tariffs[19](index=19&type=chunk) [Results of Operations](index=8&type=section&id=Results%20of%20Operations) In Q2 2025, net income rose to $258.8 million, a 42.5% increase YoY, with diluted EPS at $1.52, driven by an 8.5% quarterly increase in net interest income and a 123.8% surge in non-interest income. Selected Financial Highlights (Q2 & YTD 2025 vs 2024) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Income (in thousands)** | $258,848 | $181,633 | $485,765 | $397,956 | | **Diluted EPS** | $1.52 | $1.03 | $2.81 | $2.26 | | **Return on Average Assets (annualized)** | 1.29% | 0.96% | 1.22% | 1.05% | | **Return on Avg. Tangible Common Equity (non-GAAP, annualized)** | 17.96% | 14.17% | 16.95% | 15.25% | | **Net Interest Margin** | 3.44% | 3.39% | 3.46% | 3.40% | | **Efficiency Ratio (non-GAAP)** | 45.40% | 46.22% | 45.59% | 45.74% | [Segment Reporting](index=18&type=section&id=Segment%20Reporting) For Q2 2025, Commercial Banking's pre-tax, pre-provision net revenue (PPNR) decreased 10.0% YoY to $240.8 million, while Healthcare Financial Services' PPNR grew 4.4% to $70.9 million, and Consumer Banking's PPNR increased 2.7% to $114.2 million. Segment Pre-Tax, Pre-Provision Net Revenue (PPNR) (in thousands) | Segment | Q2 2025 | Q2 2024 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Commercial Banking** | $240,774 | $267,510 | (10.0%) | $482,273 | $537,507 | (10.3%) | | **Healthcare Financial Services** | $70,859 | $67,862 | 4.4% | $140,890 | $132,934 | 6.0% | | **Consumer Banking** | $114,219 | $111,166 | 2.7% | $219,831 | $230,800 | (4.8%) | - Commercial Banking loans and leases grew by **$581.5 million (1.4%)** since year-end 2024, driven by commercial non-mortgage lending[71](index=71&type=chunk) - Healthcare Financial Services deposits increased by **$214.4 million (2.2%)** since year-end 2024, due to growth in HSA Bank and Ametros account holders[76](index=76&type=chunk) - Consumer Banking loans increased by **$585.6 million (4.9%)** since year-end 2024, primarily from growth in residential mortgages and other consumer loans[82](index=82&type=chunk) [Financial Condition](index=21&type=section&id=Financial%20Condition) As of June 30, 2025, total assets increased by $2.9 billion (3.7%) to $81.9 billion from year-end 2024, driven by a $1.2 billion rise in loans and leases and a $0.9 billion increase in cash equivalents. Balance Sheet Changes (June 30, 2025 vs. Dec 31, 2024) | Item | Change (in billions) | Key Drivers | | :--- | :--- | :--- | | **Total Assets** | +$2.9 | +$1.2B in Loans & Leases, +$0.9B in Cash & Equivalents | | **Total Liabilities** | +$2.7 | +$1.5B in Deposits, +$1.2B in FHLB Advances | | **Total Stockholders' Equity** | +$0.2 | +$485.8M Net Income, offset by -$261.9M Stock Repurchases & Dividends | [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity and capital position, with the Holding Company's primary liquidity source being dividends from the Bank, and all regulatory capital ratios significantly exceeding 'well-capitalized' thresholds. - The Board of Directors increased the common stock repurchase program authority by **$700.0 million** on April 30, 2025, with the company repurchasing **5.1 million shares for $259.6 million** in the first six months of 2025[130](index=130&type=chunk) Regulatory Capital Ratios as of June 30, 2025 | Ratio | Webster Financial Corp. | Webster Bank | Well Capitalized Minimum | | :--- | :--- | :--- | :--- | | **CET1 Risk-Based Capital** | 11.35% | 12.55% | 6.5% | | **Tier 1 Risk-Based Capital** | 11.86% | 12.55% | 8.0% | | **Total Risk-Based Capital** | 14.05% | 13.80% | 10.0% | | **Tier 1 Leverage Capital** | 8.57% | 9.08% | 5.0% | - Total uninsured deposits, after excluding affiliate and collateralized deposits, were **$14.0 billion**, representing **21.1% of total deposits**[142](index=142&type=chunk) - The company reports immediately available liquidity of **$26.2 billion**, covering these adjusted uninsured deposits by **187.0%**[143](index=143&type=chunk) [Financial Statements](index=39&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements for the period ended June 30, 2025, show total assets of $81.9 billion, up from $79.0 billion at year-end 2024, with net income for the six months at $485.8 million. [Condensed Consolidated Financial Statements](index=39&type=section&id=Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements present the company's financial position as of June 30, 2025, with total assets of $81.9 billion, total liabilities of $72.6 billion, and total stockholders' equity of $9.3 billion. Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | $81,914,270 | $79,025,073 | | Loans and leases, net | $52,949,913 | $51,815,602 | | Total Deposits | $66,314,425 | $64,753,080 | | **Total Liabilities** | $72,576,653 | $69,891,859 | | **Total Stockholders' Equity** | $9,337,617 | $9,133,214 | Condensed Consolidated Income Statement Highlights (Six Months Ended June 30) | Account (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $1,233,374 | $1,140,036 | | Provision for credit losses | $124,000 | $104,500 | | Total Non-interest Income | $187,263 | $141,651 | | Total Non-interest Expense | $689,358 | $661,944 | | **Net Income** | **$485,765** | **$397,956** | [Notes to Condensed Consolidated Financial Statements](index=46&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures, including the January 2024 acquisition of Ametros for $378.4 million, the February 2024 sale of mortgage servicing rights for an $11.7 million net gain, and the July 2024 formation of a private credit joint venture. - On January 24, 2024, the Bank acquired Ametros for a total purchase price of **$378.4 million**, resulting in **$228.2 million of goodwill** and **$188.9 million in other intangible assets**[204](index=204&type=chunk)[205](index=205&type=chunk)[207](index=207&type=chunk) - In February 2024, the company sold the majority of its mortgage servicing portfolio for net cash proceeds of **$18.4 million**, recognizing an **$11.7 million net gain** on the sale[211](index=211&type=chunk) - In July 2024, the company formed a private credit joint venture with Marathon Asset Management, seeding it with **$242.2 million of commercial non-mortgage loans** reclassified to 'Loans held for sale' in June 2025[212](index=212&type=chunk)[213](index=213&type=chunk) - The Allowance for Credit Losses (ACL) on loans and leases increased to **$722.0 million** at June 30, 2025, from **$689.6 million** at year-end 2024, primarily due to macroeconomic uncertainty and organic loan growth[233](index=233&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=95&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section refers to the detailed market risk disclosures provided in Note 13 of the Financial Statements and the 'Asset/Liability Management and Market Risk' section of the MD&A. - The company's disclosures about market risk are incorporated by reference from Note 13 (Derivative Financial Instruments) and the 'Asset/Liability Management and Market Risk' section within the MD&A[381](index=381&type=chunk) [Controls and Procedures](index=95&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2025. - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[382](index=382&type=chunk) - A new cloud-based general ledger system was implemented during the quarter, leading to modifications and additions to internal controls over financial reporting[383](index=383&type=chunk) [PART II – OTHER INFORMATION](index=96&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=96&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to various legal proceedings in the ordinary course of business, with management believing that the outcomes will not have a material impact on the company's financial position. - Information regarding legal proceedings is incorporated by reference from Note 17: Commitments and Contingencies[387](index=387&type=chunk) [Risk Factors](index=96&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024. - No material changes to risk factors were reported since the last Annual Report on Form 10-K[388](index=388&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=96&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the second quarter of 2025, the company repurchased a total of 1,528,615 shares of its common stock at an average price of $51.70 per share, with the Board increasing repurchase authority by $700.0 million. Issuer Purchases of Equity Securities (Q2 2025) | Period (2025) | Total Shares Purchased | Avg. Price Paid Per Share | Shares Purchased Under Program | Remaining Authority (in millions) | | :--- | :--- | :--- | :--- | :--- | | April | 368,600 | $51.08 | 366,318 | $728.2 | | May | 598,919 | $52.05 | 598,257 | $697.1 | | June | 561,096 | $51.72 | 555,939 | $668.4 | | **Total** | **1,528,615** | **$51.70** | **1,520,514** | **$668.4** | - On April 30, 2025, the Board of Directors increased the authority for the common stock repurchase program by **$700.0 million**[391](index=391&type=chunk) [Other Information](index=97&type=section&id=Item%205.%20Other%20Information) John Ciulla, the Chairman and Chief Executive Officer, entered into a Rule 10b5-1 trading agreement on April 30, 2025, covering the potential sale of up to 32,000 shares of Webster common stock. - Chairman and CEO John Ciulla entered into a Rule 10b5-1 trading plan on April 30, 2025, for the sale of up to **32,000 shares of common stock**[394](index=394&type=chunk) [Exhibits](index=98&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate governance documents, indentures, new employment-related agreements, and certifications required by the Sarbanes-Oxley Act.

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both. Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor. Zacks Premium includes access to the Zacks Style Scores as well. What are the Zacks Style Scores? D ...

Core Viewpoint - Webster Financial (WBS) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system emphasizes the importance of earnings estimate revisions, which are strongly correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in stock price movements [4]. Company Performance and Outlook - The upgrade for Webster Financial suggests an improvement in the company's underlying business, which is expected to be reflected in higher stock prices [5]. - The Zacks Consensus Estimate for Webster Financial indicates an expected earnings per share of $5.86 for the fiscal year ending December 2025, with a 2.8% increase in estimates over the past three months [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% receiving a "Strong Buy" or "Buy" rating, indicating superior earnings estimate revisions [9][10]. - The upgrade of Webster Financial to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Core Insights - Zacks Premium offers various tools to help investors make informed decisions and enhance their confidence in the stock market [1] - The Zacks Style Scores provide a unique rating system for stocks based on value, growth, and momentum characteristics, aiding investors in selecting securities with high potential for market outperformance [2][3] Zacks Style Scores - Stocks are rated from A to F based on their value, growth, and momentum characteristics, with A indicating the highest potential for outperformance [3] - The Value Score identifies attractive stocks using ratios like P/E, PEG, and Price/Sales, focusing on undervalued stocks [3] - The Growth Score evaluates stocks based on projected and historical earnings, sales, and cash flow to find those with sustainable growth [4] - The Momentum Score helps investors capitalize on price trends, using factors like one-week price change and monthly earnings estimate changes [5] - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors seeking value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to simplify portfolio building [7] - Stocks rated 1 (Strong Buy) have historically produced an average annual return of +23.62% since 1988, significantly outperforming the S&P 500 [8] - There are over 800 stocks rated 1 or 2, making it essential for investors to utilize Style Scores to narrow down choices [9] Investment Strategy - For optimal returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [10] - Stocks with a 3 (Hold) rank should also have A or B Scores to maximize upside potential [10] - The direction of earnings estimate revisions is crucial; stocks with lower ranks and declining forecasts pose higher risks [11] Company Spotlight: Webster Financial (WBS) - Webster Financial Corporation, based in Stanford, CT, operates through three segments, providing various banking and financial services [12] - Currently rated 3 (Hold) with a VGM Score of B, WBS has a Momentum Style Score of A and has seen a 17% increase in shares over the past four weeks [12][13] - Recent earnings estimates for fiscal 2025 have been revised upward, with the Zacks Consensus Estimate increasing by $0.07 to $5.78 per share, alongside an average earnings surprise of +1.6% [13]