Wsfs Financial ((WSFS)) has held its Q4 earnings call. Read on for the main highlights of the call.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
In the latest earnings call, WSFS Financial Corporation displayed a generally positive sentiment, highlighting robust core earnings and notable growth in sectors like Wealth & Trust and deposits. Despite facing some challenges, such as the termination of a major client relationship and an increase in nonperforming assets, the company remains optimistic about its outlook for 2025.
Strong Core Earnings and Growth
WSFS Financial achieved impressive core earnings in the fourth quarter of 2024, with earnings per share at $1.11 and a core return on assets of 1.24%. The full year 2024 saw earnings per share reach $4.39, demonstrating a core return on assets of 1.26% and a core return on tangible common equity of 17.83%.
Record Fee Quarter in Wealth & Trust Business
The Wealth & Trust business of WSFS delivered exceptional performance, achieving a record fee quarter of $40 million, contributing to a year-over-year core fee revenue growth of 7% in the fourth quarter.
Deposit Growth and Strong Liquidity Position
WSFS reported a 4% growth in customer deposits linked quarter, with noninterest-bearing deposits increasing by 6%. The loyalty deposit ratio concluded at 77%, showcasing the company’s robust liquidity position.
Positive Outlook for 2025
WSFS anticipates another year of high performance and growth in 2025, expecting mid-single-digit loan growth in the Commercial portfolio and continued deposit growth across business lines.
Termination of Long-standing Client Relationship
The termination of a long-standing client relationship with Cash Connect resulted in a negative pre-tax financial impact of $4.7 million, highlighting some challenges faced by the company.
Loans Decline
WSFS experienced a 1% decline in loans linked quarter, attributed to higher seasonal payoffs and business sales.
Increase in Nonperforming Assets
There was an increase in nonperforming assets quarter-over-quarter due to the migration of one relationship with two loans, although these are believed to be well collateralized.
Guidance for 2025
Guidance for 2025 includes expectations for a full-year core return on assets of 1.25%, with mid-single-digit loan growth in the Commercial portfolio and flat growth in the Consumer portfolio. WSFS projects deposit growth in low-single-digits and a net interest margin around 3.80%, anticipating a rate cut in June. Fee revenue is expected to grow mid-single-digits, driven by strong performance in the Wealth & Trust business.
In conclusion, WSFS Financial’s earnings call reflected a mostly positive sentiment, with strong earnings, growth in core sectors, and a promising outlook for 2025. Despite some challenges, the company remains focused on maintaining high performance and growth, optimizing investments, and managing expenses prudently.
