Core Insights - Zions Bancorporation (ZION.US) reported a 4.65% increase in stock price, followed by a pre-market rise of 2.87% to $53.47 after the release of its Q3 earnings report, which showed earnings per share of $1.48, exceeding Wall Street's expectation of $1.46 [1][1][1] Financial Performance - The bank's credit loss provision for the quarter was $49 million, compared to $13 million in the same period last year [1] - Following the earnings report, JPMorgan raised Zions' target price from $58 to $62, while UBS analyst Nicholas Holowko maintained a hold rating and increased the target price from $58 to $63 [1][1] Management Commentary - CEO Harris H. Simmons noted that the quarter's credit performance was impacted by a $5 million charge-off and a full provision for approximately $10 million in exposure related to loans to two affiliated companies, which were found to have significant violations and misrepresentations [1] - The bank has initiated legal action to recover debts from loan guarantors, and excluding this loss, the remaining net charge-offs were only $600,000, representing an annualized rate of just 4 basis points of average loan balances, indicating overall strong performance [1][1]

Core Insights - Zions Bancorporation reported earnings per share (EPS) of $1.48 for Q3 2025, exceeding the estimated $1.40, indicating strong financial performance [1][6] - The company's revenue for Q3 2025 was $861 million, surpassing the estimated $842.3 million, driven by a 14% growth in pre-provision net revenue year-over-year [2][6] - Net earnings for Q3 2025 were $221 million, reflecting an increase from $204 million in Q3 2024 but a decrease from $243 million in Q2 2025, showing fluctuations in quarterly performance [3][6] Financial Metrics - Zions Bancorporation has a price-to-earnings (P/E) ratio of approximately 9.06, a price-to-sales ratio of about 1.54, and an enterprise value to sales ratio of around 2.45, indicating its market valuation relative to earnings and sales [4] - The company’s debt-to-equity ratio is about 1.07, and its current ratio is approximately 0.15, reflecting its financial leverage and ability to cover short-term liabilities [5] - Despite a 3% annualized contraction in loans, Zions' earnings yield stands at 11.04%, highlighting its potential return on investment based on earnings [5]

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Zions Bancorp said its profit topped analyst estimates despite a $50 million loss from an alleged fraud tied to a commercial real estate investor group in Southern California. https://t.co/h03TNHta1J ...

Group 1 - The risk of a systemic crisis is still controllable, and the probability of a repeat of the "subprime mortgage crisis" is low. Large banks and the core financial system remain stable [1][3] - Recent financial "blow-up" events in the U.S. include the bankruptcy of Tricolor on September 10, FirstBrands on September 28, and significant credit fraud and bad debt issues at Zions Bancorp and Western Alliance Bancorp on October 16 [1][2] - The S&P regional bank index fell by 6.3% on October 16, indicating that risks are concentrated in regional banks, while large banks and other sectors were less affected [1] Group 2 - The current private credit risks in the U.S. differ fundamentally from those during the Silicon Valley Bank crisis, with the latter being driven by interest rate hikes leading to asset-liability mismatches and liquidity crises [2] - The current financial risk events are characterized by economic slowdown leading to deteriorating credit quality, which exposes issues such as financial fraud and high-leverage financing [2][3] - There is a concern that the "credit blow-up chain" may not be over, with potential for further risk escalation due to the underlying weaknesses in the financial market [3] Group 3 - If risks escalate, asset prices may be impacted, particularly in the banking and financial sectors, with expectations of initial declines followed by potential recoveries in the stock market [5] - U.S. Treasury yields and the dollar are expected to trend downward, especially if the Federal Reserve accelerates rate cuts in response to rising risks [5] - Gold prices are likely to rise due to increased demand for safe-haven assets amid heightened risk sentiment [5]

Core Insights - Zions (ZION) reported revenue of $872 million for the quarter ended September 2025, reflecting an 8.5% increase year-over-year, with EPS at $1.54 compared to $1.37 in the previous year [1] - The revenue exceeded the Zacks Consensus Estimate of $845.49 million by 3.14%, and the EPS surpassed the consensus estimate of $1.19 by 29.41% [1] Financial Performance Metrics - Net interest margin was reported at 3.3%, slightly above the estimated 3.2% [4] - Net charge-offs to average loans and leases were 0.4%, higher than the average estimate of 0.2% [4] - Efficiency Ratio stood at 59.6%, better than the estimated 62.6% [4] - Average balance of total interest-earning assets was $82.78 billion, below the estimated $83.67 billion [4] - Total nonperforming assets were $324 million, slightly above the average estimate of $319.28 million [4] - Tier 1 leverage ratio was 8.8%, exceeding the average estimate of 8.5% [4] - Total nonaccrual loans were $319 million, compared to the average estimate of $314.4 million [4] - Total risk-based capital ratio was 13.7%, above the estimated 13.4% [4] - Tier 1 risk-based capital ratio was 11.4%, higher than the average estimate of 11.1% [4] - Total noninterest income reached $189 million, surpassing the average estimate of $174.09 million [4] - Commercial account fees were $47 million, slightly above the average estimate of $46.36 million [4] - Other customer-related fees totaled $15 million, exceeding the average estimate of $13.81 million [4] Stock Performance - Zions shares have returned -15.4% over the past month, contrasting with the Zacks S&P 500 composite's +1.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - Despite significant losses from two loans, Zion Bank reported a profit increase in Q3, driven by growth in interest income [1][2] Financial Performance - Zion Bank's Q3 revenue reached $872 million, a year-on-year increase of 8.5%, exceeding market expectations [1] - The bank's net interest income rose from $620 million in the same period last year to $672 million [2] - Net profit applicable to shareholders for the three months ended September 30 was approximately $221 million, translating to earnings per share of $1.48, compared to $204 million and $1.37 per share in the same period last year [2] Loan Losses and Market Reaction - The bank disclosed a $50 million loss from two commercial and industrial loans in its California branch for Q3 [1] - CEO Harris Simmons stated that excluding this loss, the remaining net write-offs were only $6 million, representing a mild annualized rate of 4 basis points of average loans [1] - Following the disclosure of these losses, bank stocks experienced a decline, but U.S. bank stocks rebounded the following Friday, alleviating some market tension [1] Analyst Insights - Analyst Terry McEvoy from Stephens noted that several U.S. regional banks did not report unusual or unexpected credit losses in their Q3 results, and management's outlook for Q4 was reassuring [1] - The trends suggest that the pressures faced by a few companies are more isolated incidents rather than emerging trends [1]

Market Performance - All major indexes finished up more than +1%, with the Dow gaining +515 points (+1.12%), S&P 500 up +71 points (+1.07%), Nasdaq increasing by +310 points (+1.37%), and Russell 2000 rising +47 points (+1.93%) [1] Apple Inc. - Apple experienced strong adoption of its iPhone 17, driven by Chinese subsidies for the base-model iPhone, marking the healthiest up-cycle for new iPhones since the Covid pandemic. The stock rose +3.94% to $262 per share, achieving its highest close ever and a market cap of $3.85 trillion, making it the second-richest company behind NVIDIA [2] Boeing Co. - Boeing's shares rose +1.8% following the FAA's approval to increase the production of 737-MAX planes to 42 per month, with expected output increases and certifications for MAX-7 and MAX-10 models next year. Boeing is set to report Q3 earnings next week [3] Zions Bancorp - Zions Bancorp reported Q3 earnings of $1.48 per share, exceeding estimates by 8 cents and showing an increase from the previous year. Revenues reached $861 million, surpassing analyst expectations of $845.5 million. Despite a previous drop of -13% in shares due to $49 million in charge-offs, shares rose +3% in late trading following the earnings report [4][5] Upcoming Earnings Reports - Key earnings reports are expected from GE Aerospace, Lockheed Martin, General Motors, Coca-Cola, and 3M, with Netflix and Texas Instruments reporting in the afternoon. No economic reports are scheduled for release [6]

Core Viewpoint - Zions (ZION) reported quarterly earnings of $1.54 per share, exceeding the Zacks Consensus Estimate of $1.19 per share, and showing an increase from $1.37 per share a year ago, indicating a strong earnings surprise of +29.41% [1][2] Financial Performance - The company achieved revenues of $872 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.14% and up from $804 million year-over-year [2] - Over the last four quarters, Zions has consistently surpassed consensus EPS estimates and topped revenue estimates three times [2] Stock Performance and Outlook - Zions shares have declined approximately 8.4% year-to-date, contrasting with the S&P 500's gain of 13.3% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $1.47, with projected revenues of $858.26 million, and for the current fiscal year, the estimate is $5.68 on $3.35 billion in revenues [7] - The estimate revisions trend for Zions was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Zacks Industry Rank for Banks - West is currently in the bottom 35% of over 250 Zacks industries, suggesting that the industry outlook may significantly impact Zions' stock performance [8]

Financial Data and Key Metrics Changes - The net interest margin expanded by 11 basis points to 3.28% [5][10] - Customer fees, excluding net credit valuation adjustment, grew by $10 million [5] - Adjusted expenses declined by $1 million, leading to an improved efficiency ratio of 59.6% [5] - Diluted earnings per share was $1.48, down from $1.63 in the prior period [7] - The provision for credit loss was recorded at $49 million, with net charge-offs of $56 million, or 37 basis points of loans on an annualized basis [6][17] Business Line Data and Key Metrics Changes - Net interest income increased by $52 million, or 8%, compared to the third quarter of 2024 [9] - Customer-related non-interest income was $163 million, slightly down from $164 million in the prior period [11] - Adjusted customer-related non-interest income, excluding net CVA, was $174 million, representing a 6% increase versus the second quarter [11] - Average loans increased by 2.1% annualized over the previous quarter [13] - Average deposit balances were relatively flat, with a notable 11.5% reduction in average brokered deposits [13][14] Market Data and Key Metrics Changes - Average non-interest-bearing deposits grew by approximately $192 million, or 0.8% compared to the prior quarter [14] - Total borrowings declined by $1.8 billion during the quarter [15] - Non-performing assets remained low at 0.54% of loans and other real estate owned [16] Company Strategy and Development Direction - The company aims to continue producing positive operating leverage as revenue growth outpaces non-interest expense growth [19] - There is a focus on enhancing capital markets offerings, including real estate capital markets and investment banking advisory fees [11] - The company is open to M&A opportunities but prioritizes smaller deals that enhance market density [58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that the credit issues faced are isolated incidents and emphasized a strong credit history [24][96] - The outlook for net interest income is moderately increasing, supported by continued growth in loans and deposits [9][10] - Management expects to maintain a stable risk appetite despite recent credit challenges [96] Other Important Information - The common equity tier one ratio was reported at 11.3%, indicating a strong capital position [18] - The company has seen a 17% growth in tangible book value per share compared to the prior year [18] Q&A Session Summary Question: Can you talk about the isolated incident related to the charge-offs? - Management confirmed that the incident is isolated and has conducted a thorough review of the portfolio, finding no similar issues [22][23] Question: What is the outlook for net interest income? - The guidance includes expectations for fixed-rate asset repricing and loan growth, with a potential yield pickup of 2-3 basis points [31][32] Question: How has loan demand changed recently? - Loan spreads have improved slightly, and while there was some runoff in CNI, production has been up in most months this year [78][81] Question: What is the company's approach to M&A? - The company is open to smaller deals that enhance market presence but is not under pressure to pursue acquisitions [58][59] Question: How does the company view the NDFI portfolio? - Management believes that concerns regarding the NDFI portfolio are somewhat overblown, highlighting the safety of certain categories like capital call lines [106]