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Bankwell Financial Group (BWFG)
NASDAQ:BWFG
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Bankwell Financial Group
(NASDAQ:BWFG)
Rating:76Outperform
Price Target:
$49.00
▲(11.72% Upside)
Bankwell Financial Group (BWFG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$345.33M
Dividend Yield1.82%
Average Volume (3M)34.77K
Price to Earnings (P/E)17.0
Beta (1Y)0.85
Revenue Growth0.75%
EPS Growth-12.45%
CountryUS
Employees145
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.15
Shares Outstanding7,873,387
10 Day Avg. Volume40,881
30 Day Avg. Volume34,766
Financial Highlights & Ratios
PEG Ratio-0.33
Price to Book (P/B)0.89
Price to Sales (P/S)1.23
P/FCF Ratio8.19
Enterprise Value/Market Cap0.33
Enterprise Value/Revenue0.57
Enterprise Value/Gross Profit1.37
Enterprise Value/Ebitda3.57
Forecast
1Y Price Target
$40.25Price Target Upside-8.23% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Bankwell Financial Group Business Overview & Revenue Model
Company DescriptionBankwell Financial Group (BWFG) is a bank holding company headquartered in New Canaan, Connecticut, specializing in providing a range of financial services through its wholly-owned subsidiary, Bankwell Bank. The company operates primarily in the banking sector, offering a variety of products including commercial and consumer loans, deposit accounts, treasury management services, and investment services. BWFG focuses on serving individuals, small businesses, and commercial clients, with an emphasis on local community banking.
How the Company Makes MoneyBankwell Financial Group generates revenue primarily through the interest income earned on loans and investments, as well as fees associated with various banking services. Key revenue streams include net interest income, which comprises the difference between interest earned on loans and interest paid on deposits, and non-interest income from fees for services such as account maintenance, ATM usage, and mortgage origination. Additionally, BWFG may benefit from partnerships with other financial institutions, investment firms, or service providers to enhance its service offerings and customer base, contributing further to its earnings.
Bankwell Financial Group Earnings Call Summary
Earnings Call Date:Jul 28, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant improvements in net interest margin, loan originations, and asset quality, which contributed to increased earnings and profitability. However, there were challenges with elevated loan payoffs, increased noninterest expenses, and unresolved nonperforming assets.Q2-2025 Updates
Positive Updates
Significant Net Interest Margin Expansion
The company's net interest margin expanded to 310 basis points, a 29 basis point increase from the previous quarter. This was attributed to decreased funding costs and a diversified loan mix.
Robust Loan Originations
Bankwell funded $170 million in new loans in Q2, leading to $24 million in linked quarter growth. SBA loans had a strong pipeline with $22 million year-to-date originations.
Improved Asset Quality
Nonperforming loans dropped significantly from a peak of $65 million in Q3 2024 to just under $24 million in this quarter, marking an 89 basis point of total loans reduction.
Growth in Noninterest-Bearing Deposits
Noninterest-bearing deposits increased by $48 million in the quarter, achieving a year-to-date growth of $75 million or 23% since year-end.
Increased Earnings and Profitability
GAAP fully diluted earnings per share increased by 32% relative to the first quarter due to significant net interest margin expansion and SBA loan sales contributions.
Negative Updates
Elevated Loan Payoffs
Loan payoffs were $150 million during the second quarter, which, although down from the first quarter, remained higher than expected on a normalized basis.
Increased Noninterest Expense
Total noninterest expense increased from $14.1 million to $14.5 million, mainly due to higher salaries and employee benefits. This led to a revised full-year guidance increase for noninterest expense to $58 million to $59 million.
Unresolved Nonperforming Assets
Two significant nonperforming loans remain unresolved with uncertain timelines. One loan is expected to refinance soon, while the other may take longer to resolve.
Company Guidance
During the second quarter 2025 earnings call, Bankwell Financial Group, Inc. reported a net interest margin of 310 basis points, reflecting a 29 basis point increase from the previous quarter, driven by reduced funding costs and lower time deposit rates. GAAP fully diluted earnings per share were $1.15, up 32% from the first quarter, supported by significant net interest margin expansion and increased SBA loan sales contributions. The company funded $170 million in new loans, resulting in a $24 million quarter-over-quarter growth, despite $150 million in loan payoffs. Noninterest-bearing deposits grew by $48 million during the quarter, a 23% increase since year-end 2024, with expectations for continued deposit base improvements as new teams in the New York City metro area contribute. The bank's efficiency ratio improved to 56.1% from 59.9% in the previous quarter, and the net interest income guidance for full-year 2025 was updated to a range of $97 million to $98 million. Additionally, noninterest income increased by 34% to $2 million, with SBA gain-on-sale income contributing $1.1 million. Bankwell remains optimistic about further margin expansion and continued improvement in asset quality, as nonperforming loans decreased to just under $24 million, representing 89 basis points of total loans.Bankwell Financial Group Financial Statement Overview
Summary
Bankwell Financial Group is in a stable financial position with steady revenue growth and strong profitability margins. The company maintains a balanced debt-to-equity ratio, but its high leverage could be a risk in fluctuating market conditions. The cash flow position is solid, though there's a slight decline in free cash flow growth.Income Statement
Bankwell Financial Group has demonstrated steady revenue growth with a TTM revenue increase of 0.4%. The gross profit margin is robust at 35.2%, and the net profit margin is strong at 6.6%. However, there has been a decline in EBIT and EBITDA margins compared to previous years, indicating potential cost pressures.75
Positive
Balance Sheet
The company's debt-to-equity ratio is moderate at 0.40, reflecting a balanced use of debt. The return on equity is healthy at 4.7%, showcasing effective use of equity. However, the equity ratio stands at 8.6%, suggesting a relatively high leverage position which could pose risks.70
Positive
Cash Flow
Bankwell Financial Group has shown a consistent operating cash flow with a TTM free cash flow growth rate of -17.5%, signaling potential challenges. The operating cash flow to net income ratio is favorable at 1.93, indicating strong cash generation relative to net income.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 198.80M | 195.71M | 193.30M | 120.98M | 87.03M | 80.37M |
| Gross Profit | 81.75M | 64.38M | 98.44M | 92.35M | 73.60M | 50.11M |
| EBITDA | 31.43M | 17.10M | 51.67M | 51.35M | 37.44M | 10.58M |
| Net Income | 20.86M | 9.77M | 36.66M | 37.43M | 26.59M | 5.90M |
Balance Sheet | ||||||
| Total Assets | 3.24B | 3.27B | 3.22B | 3.25B | 2.46B | 2.25B |
| Cash, Cash Equivalents and Short-Term Investments | 316.19M | 325.27M | 277.31M | 448.59M | 381.80M | 493.94M |
| Total Debt | 144.57M | 171.50M | 159.21M | 158.96M | 84.44M | 200.26M |
| Total Liabilities | 2.95B | 3.00B | 2.95B | 3.01B | 2.25B | 2.08B |
| Stockholders Equity | 283.29M | 270.52M | 265.75M | 238.47M | 201.99M | 176.60M |
Cash Flow | ||||||
| Free Cash Flow | 23.52M | 29.32M | 29.88M | 77.71M | 38.81M | 1.82M |
| Operating Cash Flow | 24.15M | 29.94M | 31.93M | 82.67M | 34.56M | -1.51M |
| Investing Cash Flow | -27.14M | -33.96M | -48.30M | -811.16M | -270.02M | -21.94M |
| Financing Cash Flow | 74.08M | 42.39M | -70.15M | 739.49M | 170.55M | 355.00M |
Bankwell Financial Group Technical Analysis
Positive
43.86
Price Trends
39.56
Positive
36.76
Positive
33.55
Positive
Market Momentum
1.17
Negative
73.14
Negative
91.45
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BWFG, the sentiment is Positive. The current price of 43.86 is above the 20-day moving average (MA) of 41.76, above the 50-day MA of 39.56, and above the 200-day MA of 33.55, indicating a bullish trend. The MACD of 1.17 indicates Negative momentum. The RSI at 73.14 is Negative, neither overbought nor oversold. The STOCH value of 91.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BWFG.
Bankwell Financial Group Risk Analysis
Bankwell Financial Group disclosed 35 risk factors in its most recent earnings report. Bankwell Financial Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bankwell Financial Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $312.86M | 11.59 | 9.73% | 5.53% | 8.59% | 14.56% | |
78 Outperform | $304.70M | 10.49 | 11.76% | 5.32% | 12.08% | 9.69% | |
76 Outperform | $345.33M | 17.00 | 7.29% | 1.82% | 0.75% | -12.45% | |
70 Outperform | $326.95M | 13.73 | 7.50% | 2.00% | 1.75% | 2.76% | |
68 Neutral | $17.81B | 11.59 | 9.87% | 3.74% | 9.69% | 1.11% | |
57 Neutral | $275.26M | 93.08 | 0.79% | 3.58% | 4.72% | ― | |
| ― | $316.27M | 10.06 | 12.63% | ― | ― | ― |
* Financial Sector Average
Performance Comparison
BWFG
Bankwell Financial Group
43.98
14.43
48.83%
CZNC
Citizens & Northern
20.02
2.20
12.35%
FNLC
First Bancorp
26.91
2.41
9.84%
FRST
Primis Financial
10.96
0.07
0.64%
BCML
BayCom
29.76
8.23
38.23%
COSO
CoastalSouth Bancshares
23.01
3.13
15.74%
Bankwell Financial Group Corporate Events
DividendsBusiness Operations and StrategyFinancial Disclosures
Bankwell Financial Group Reports Strong Q2 Earnings Growth
Positive
Jul 28, 2025
On July 28, 2025, Bankwell Financial Group reported its second-quarter financial results, showing a significant increase in net income to $9.1 million, or $1.15 per share, compared to the previous quarter. The company announced a quarterly dividend of $0.20 per share, payable on August 22, 2025. The results reflect an improved net interest margin of 3.10% and a net loan growth of $24 million, driven by accelerated loan originations, particularly in SBA loans. The company has also enhanced its deposit gathering capabilities by adding new private banking teams, which is expected to boost deposit growth. Bankwell updated its 2025 guidance, projecting growth in net interest income and noninterest income, while managing higher noninterest expenses due to investments in personnel.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.