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Northwest Bancshares (NWBI)
NASDAQ:NWBI
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Northwest Bancshares
(NASDAQ:NWBI)
71Outperform
Northwest Bancshares (NWBI) vs. S&P 500 (SPY)
Market Cap
$1.50B
Dividend Yield6.79%
Average Volume (3M)671.25K
Price to Earnings (P/E)15.0
Beta (1Y)0.86
Revenue Growth7.67%
EPS Growth-25.85%
CountryUS
Employees2,165
SectorFinancial
Sector Strength77
IndustryBanking
Share Statistics
EPS (TTM)0.78
Shares Outstanding127,514,854
10 Day Avg. Volume665,847
30 Day Avg. Volume671,250
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.02
Price to Cash Flow (P/CF)-4.90
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$15.00Price Target Upside26.58% Upside
Rating ConsensusHold
Number of Analyst Covering2
Northwest Bancshares Business Overview & Revenue Model
Company DescriptionNorthwest Bancshares, Inc. is a holding company. It offers personal & business banking products including employee benefits, investment management services, insurance and trust. It engages in collecting deposits and making loans secured by various types of collateral, including real estate and other assets. The company was founded on June 29, 2001 and is headquartered in Warren, PA.
How the Company Makes MoneyNorthwest Bancshares generates revenue primarily through its interest income from lending activities. This includes loans to individuals, such as mortgages and personal loans, and loans to businesses. The company also earns money through non-interest income, which encompasses fees and service charges from deposit accounts, card services, and wealth management services. Additionally, Northwest Bancshares may engage in investment activities that contribute to its earnings. Key factors influencing its revenue include the interest rate environment, economic conditions, and the company's ability to attract and retain customers through competitive product offerings and customer service. While the company may have partnerships, specific data on significant partnerships is not available.
Northwest Bancshares Financial Statement Overview
Summary
Northwest Bancshares demonstrates strong revenue growth and a solid balance sheet with zero debt and substantial cash reserves. However, profitability margins are under pressure, and cash flow metrics reflect challenges in cash generation. While the company maintains a sound equity base, there is a need for improvement in cash flow management to sustain long-term growth.Income Statement
Northwest Bancshares shows a stable revenue base with a recent revenue growth rate of approximately 27.07% from 2023 to 2024. The gross profit margin remains robust at 100%, typical for the banking industry. However, the net profit margin decreased to 15.00% in 2024 from 25.62% in 2023, indicating reduced profitability. The EBIT margin also decreased to 2.99% in 2024, suggesting pressure on operational profitability.72
Positive
Balance Sheet
The company's balance sheet reflects strong liquidity with significant cash reserves. The equity ratio improved to 11.08% in 2024 from 10.76% in 2023, showing a slight increase in financial stability. The debt-to-equity ratio improved as total debt was eliminated in 2024, reducing financial leverage risk. Return on equity declined to 6.28% from 8.70%, indicating a decrease in shareholder profitability.80
Positive
Cash Flow
Operating cash flow decreased by 32.86% in 2024, reflecting a drop in cash-generating efficiency. The free cash flow also decreased by 26.07% from the previous year. The operating cash flow to net income ratio was 0.62 in 2024, indicating moderate cash flow coverage relative to net income.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 520.47M | 526.63M | 529.72M | 506.89M | 520.72M | Gross Profit |
| 669.20M | 526.63M | 529.72M | 506.89M | 520.72M | EBIT |
| 20.01M | 202.88M | 173.69M | 201.12M | 92.53M | EBITDA |
| 0.00 | 0.00 | 180.14M | 207.76M | 97.26M | Net Income Common Stockholders |
| 100.28M | 134.96M | 133.67M | 154.32M | 74.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.40B | 122.26M | 1.36B | 2.83B | 2.14B | Total Assets |
| 14.41B | 14.42B | 14.11B | 14.50B | 13.81B | Total Debt |
| 444.70M | 642.66M | 900.22M | 391.72M | 411.84M | Net Debt |
| 156.32M | 520.40M | 760.86M | -887.54M | -324.44M | Total Liabilities |
| 12.81B | 12.87B | 12.62B | 12.92B | 12.27B | Stockholders Equity |
| 1.60B | 1.55B | 1.49B | 1.58B | 1.54B |
| Cash Flow | Free Cash Flow | |||
| 62.34M | 84.33M | 171.11M | 187.94M | 128.18M | Operating Cash Flow |
| 62.34M | 92.89M | 175.43M | 205.46M | 140.44M | Investing Cash Flow |
| 174.97M | -239.68M | -917.42M | -232.97M | -560.58M | Financing Cash Flow |
| -99.40M | 129.69M | -397.90M | 570.49M | 1.10B |
Northwest Bancshares Technical Analysis
Negative
11.85
Price Trends
12.75
Negative
13.28
Negative
12.70
Negative
Market Momentum
-0.28
Positive
30.48
Neutral
8.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NWBI, the sentiment is Negative. The current price of 11.85 is below the 20-day moving average (MA) of 12.48, below the 50-day MA of 12.75, and below the 200-day MA of 12.70, indicating a bearish trend. The MACD of -0.28 indicates Positive momentum. The RSI at 30.48 is Neutral, neither overbought nor oversold. The STOCH value of 8.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NWBI.
Northwest Bancshares Risk Analysis
Northwest Bancshares disclosed 48 risk factors in its most recent earnings report. Northwest Bancshares 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
Northwest Bancshares Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $567.65M | 11.64 | 7.39% | 4.82% | 6.97% | -16.70% | |
73 Outperform | $2.97B | 16.48 | 10.51% | 3.23% | 24.22% | 35.49% | |
71 Outperform | $1.50B | 15.02 | 6.36% | 6.79% | 7.67% | -25.85% | |
65 Neutral | $660.54M | 18.89 | 4.78% | 4.24% | 10.94% | 26.35% | |
64 Neutral | $13.79B | 10.52 | 9.20% | 4.24% | 17.25% | -7.60% | |
62 Neutral | $3.14B | 10.97 | 9.69% | 4.00% | 21.10% | -4.20% | |
61 Neutral | $4.87B | 12.37 | 7.62% | 4.32% | 6.80% | 1.48% |
* Financial Sector Average
Performance Comparison
NWBI
Northwest Bancshares
11.82
1.57
15.32%
CBU
Community Bank System
57.08
14.52
34.12%
FULT
Fulton Financial
17.65
3.42
24.03%
HBNC
Horizon Bancorp
15.22
3.91
34.57%
TRST
TrustCo Bank
29.65
4.44
17.61%
UBSI
United Bankshares
34.22
2.05
6.37%
Northwest Bancshares Earnings Call Summary
Earnings Call Date: Jan 24, 2025 | % Change Since: -8.71% | Next Earnings Date: Apr 28, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment with strong financial performance, strategic acquisitions, and improved metrics in efficiency and deposit growth. However, challenges such as flat loan balances and increased expenses suggest areas for improvement.Highlights
Improved Net Interest Margin and Efficiency Ratio
Net interest margin expanded by 13 basis points to 3.42%, showing significant improvement in the company's efficiency ratio.
Successful Acquisition Announcement
Northwest Bancshares entered an agreement to acquire Penns Woods Bancorp, expected to complete in Q3 2025. This merger will make Northwest one of the top 100 largest banks in the nation.
Strong Deposit Growth
Deposit balances grew by 8% compared to the fourth quarter a year ago, with a decrease in the cost of funds.
Increased Noninterest Income
Noninterest income increased by $12 million, including a $6 million gain on the sale of shares and a $4 million gain from a tax credit investment.
Stable Capital and Credit Quality
Estimated Tier 1 capital to risk-weighted assets at 13.8%, and a strong credit quality with a decrease in classified loans and an increase in coverage ratio on nonperforming loans.
Lowlights
Flat Loan Portfolio Balances
Loan portfolio balances were essentially flat compared to the same quarter last year, despite a shift towards more commercially weighted portfolios.
Increased Noninterest Expense
Noninterest expense increased by 5% or approximately $3 million from the third quarter.
Decline in Residential Mortgages
Residential mortgages declined by 6.6% year-over-year, indicating a shift away from this segment.
Slight Increase in Loan Delinquencies
30-day loan delinquencies saw a slight increase of 20 basis points.
Company Guidance
During the Northwest Bancshares Fourth Quarter 2024 Earnings Call, the company provided comprehensive guidance for 2025. They anticipate low single-digit growth in both loans and deposits, with a focus on commercial and industrial (C&I) lending, which saw a 23.5% year-over-year increase. The company expects noninterest income to range between $124 million and $129 million for the year. Despite a 5% increase in noninterest expenses, they aim to maintain expense growth in the low single digits. Their net interest margin, which improved to 3.42% in Q4 2024, is projected to expand modestly as they manage deposit costs while balancing client expectations. The guidance excludes impacts from the recent Penns Woods Bancorp acquisition, with net charge-offs expected to normalize within 25 to 35 basis points, and the tax rate remaining unchanged for 2025.Northwest Bancshares Corporate Events
M&A Transactions
Northwest Bancshares Announces Merger with Penns Woods
Positive
Dec 17, 2024
Northwest Bancshares announced a merger agreement with Penns Woods Bancorp, which will see Penns Woods and its subsidiaries, Luzerne Bank and Jersey Shore State Bank, merge into Northwest and its subsidiary, Northwest Bank. This merger is expected to enhance Northwest’s market position and expand its service offerings, though it is subject to shareholder and regulatory approvals.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.