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NatWest Group (NWG)
NYSE:NWG
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NatWest Group
(NYSE:NWG)
Rating:77Outperform
Price Target:
$16.00
â–²(13.15% Upside)
NatWest Group (NWG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$56.43B
Dividend Yield4.52%
Average Volume (3M)4.02M
Price to Earnings (P/E)9.0
Beta (1Y)1.00
Revenue Growth10.03%
EPS Growth29.51%
CountryUS
Employees59,400
SectorFinancial
Sector Strength67
IndustryBanks - Diversified
Share Statistics
EPS (TTM)0.41
Shares Outstanding4,046,534,000
10 Day Avg. Volume3,808,882
30 Day Avg. Volume4,023,874
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue2.14
Enterprise Value/Gross Profit3.60
Enterprise Value/Ebitda7.08
Forecast
1Y Price Target
$16.00Price Target Upside13.15% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
NatWest Group Business Overview & Revenue Model
Company DescriptionNatWest Group plc, together with its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers in the United Kingdom and internationally. It operates through Retail Banking, Commercial Banking, Private Banking, RBS International, and NatWest Markets segments. The Retail Banking segment offers a range of banking products and related financial services, such as current accounts, mortgages, personal unsecured lending, and personal deposits, as well as mobile and online banking services. The Commercial Banking segment offers banking and financing solutions to start-up, SME, commercial, corporate, and institutional customers. The Private Banking segment provides private banking and wealth management products for high-net-worth individuals and their business interests. The RBS International segment offers banking various products and services to institutional customers. It also operates in wholesale branches and fund depositary service businesses. The NatWest Markets segment provides services to corporate and institutional customers for the management of financial risks for achieving short-term and long-term sustainable financial goals. NatWest Group plc operates approximately 800 branches and 16,000 physical points of presence. The company was formerly known as The Royal Bank of Scotland Group plc and changed its name to NatWest Group plc in July 2020. NatWest Group plc was founded in 1727 and is headquartered in Edinburgh, the United Kingdom.
How the Company Makes MoneyNatWest Group makes money primarily through its banking operations, which include interest income from loans and mortgages provided to personal and commercial customers. The company earns interest by charging borrowers a higher interest rate than it pays to depositors. Additionally, NWG generates revenue from fees and commissions on various financial products and services, such as account maintenance fees, transaction fees, and advisory services in wealth management. The company also earns income from trading and investment activities, insurance premiums, and asset management services. Key partnerships with financial technology firms and strategic alliances help expand its digital banking services, contributing to its earnings by enhancing customer experience and operational efficiency.
NatWest Group Key Performance Indicators (KPIs)
Any
Operating Profit by Segment
Highlights the profitability of each business unit, indicating which segments are driving earnings and where there might be challenges or opportunities for growth.
Highlights the profitability of each business unit, indicating which segments are driving earnings and where there might be challenges or opportunities for growth.
Data provided by:
Main Street Data
Main Street DataNatWest Group Earnings Call Summary
Earnings Call Date:Jul 25, 2025
(Q2-2025)
| % Change Since: 4.20%|
Next Earnings Date:Oct 24, 2025
Earnings Call Sentiment Positive
The earnings call for NatWest Group reflected a generally positive sentiment, with strong financial performance, significant customer growth, and strategic advancements. While there were some challenges noted, such as reductions in noninterest income and potential cost pressures, the positives, including an upgraded income and return guidance, significantly outweighed the negatives.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Income grew 13.7% to GBP 8 billion, while costs reduced 1.4% to GBP 3.9 billion. This resulted in an operating profit of GBP 3.6 billion and attributable profit of GBP 2.5 billion. Return on tangible equity was 18.1%, and earnings per share increased by 28% to 31p.
Significant Dividend and Buyback Announcement
Announced an interim dividend of 9.5p, up 58%, and a new share buyback of GBP 750 million, bringing total distributions declared to shareholders in the first half to around GBP 1.5 billion.
Successful Customer Growth
Customer lending grew 3.2% to GBP 384 billion. Customer deposits increased by 1% to GBP 436 billion. Over 100,000 new customers were attracted through organic growth, with an additional 1 million customers added through the Sainsbury's transaction in May.
Improved Cost Efficiency
The cost to income ratio was reduced from around 56% last year to around 49% this year.
Upgraded 2025 Guidance
Upgraded 2025 guidance for both income and returns, expecting income greater than GBP 16 billion and a return on tangible equity above 16.5%.
Negative Updates
Reduction in Noninterest Income
Noninterest income across the three businesses was down 0.8% compared with a strong quarter.
Impact of Interest Rate Cuts
Net interest margin was up only 1 basis point at 228, mainly reflecting deposit margin expansion. The bank continues to assume two further rate cuts this year, with rates expected to reach 3.75% by the year-end.
Potential Cost Challenges Ahead
Operating expenses were 3% higher at GBP 2 billion in Q2, with further business transformation, remaining onetime integration costs, and the bank levy expected to drive expenses higher in the second half.
Company Guidance
In the first half of 2025, NatWest Group reported strong financial performance with customer lending increasing by 3.2% to £384 billion, and customer deposits rising by 1% to £436 billion. Assets under management and administration surged by 5.9% to £52 billion. The company's income grew by 13.7% to £8 billion while costs decreased by 1.4% to £3.9 billion, leading to an operating profit of £3.6 billion and an attributable profit of £2.5 billion. The return on tangible equity was reported at 18.1%, with earnings per share up 28% to 31p. An interim dividend of 9.5p was announced, reflecting a 58% increase, and tangible net asset value per share rose by 16% to 351p. The CET1 ratio remained stable at 13.6%. The group also initiated a £750 million share buyback, bringing total distributions to shareholders in the first half to approximately £1.5 billion. NatWest upgraded its 2025 guidance, expecting income to exceed £16 billion and a return on tangible equity above 16.5%.NatWest Group Financial Statement Overview
Summary
NatWest Group exhibits a solid financial foundation with a strong equity position and improving cash flow. Despite some volatility in profitability and cash management, the company's consistent revenue and equity growth provide a robust base for future performance.Income Statement
NatWest Group's income statement reveals moderate financial health with a solid gross profit margin, but the net profit margin has shown fluctuations due to varying net income over the years. The revenue growth rate is relatively stable, indicating consistent business operations. However, the absence of recent EBIT and EBITDA data limits a comprehensive profitability assessment.75
Positive
Balance Sheet
The balance sheet demonstrates strong equity with a favorable equity ratio and zero total debt in the latest period, reducing financial risk. The return on equity is robust, indicating effective use of equity in generating profits. The consistent increase in stockholders' equity highlights a stable financial position, but the high total liabilities warrant attention.80
Positive
Cash Flow
Cash flow analysis shows improvements, with positive free cash flow in the latest year after previous deficits, indicating better cash management. The operating cash flow to net income ratio suggests that cash earnings are catching up with accounting earnings, yet historical fluctuations in cash flows present potential volatility concerns.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 25.52B | 28.57B | 14.17B | 12.98B | 11.75B | 7.69B |
| Gross Profit | 15.20B | 14.65B | 14.17B | 12.98B | 11.75B | 10.80B |
| EBITDA | 7.73B | 7.25B | 7.12B | 6.00B | 4.77B | 361.00M |
| Net Income | 5.17B | 4.80B | 4.64B | 3.59B | 3.27B | -372.00M |
Balance Sheet | ||||||
| Total Assets | 710.03B | 707.99B | 692.67B | 720.05B | 781.99B | 799.49B |
| Cash, Cash Equivalents and Short-Term Investments | 99.05B | 93.05B | 104.52B | 145.06B | 177.76B | 124.49B |
| Total Debt | 68.91B | 65.92B | 38.16B | 39.93B | 40.20B | 9.96B |
| Total Liabilities | 668.42B | 668.61B | 655.49B | 683.56B | 740.19B | 755.67B |
| Stockholders Equity | 41.59B | 39.35B | 37.16B | 36.49B | 41.80B | 43.86B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 694.00M | -14.92B | -44.24B | 52.79B | 28.72B |
| Operating Cash Flow | 0.00 | 1.77B | -13.37B | -43.60B | 53.69B | 29.09B |
| Investing Cash Flow | 0.00 | -12.70B | -14.69B | 19.06B | 3.06B | 7.55B |
| Financing Cash Flow | 0.00 | -1.89B | -23.52B | -10.65B | -2.60B | 90.00M |
NatWest Group Technical Analysis
Positive
14.14
Price Trends
13.88
Positive
13.21
Positive
11.70
Positive
Market Momentum
0.12
Negative
56.50
Neutral
82.88
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NWG, the sentiment is Positive. The current price of 14.14 is above the 20-day moving average (MA) of 13.74, above the 50-day MA of 13.88, and above the 200-day MA of 11.70, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 56.50 is Neutral, neither overbought nor oversold. The STOCH value of 82.88 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NWG.
NatWest Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $214.91B | 12.30 | 10.69% | 5.21% | -2.96% | -13.66% | |
78 Outperform | $129.76B | 9.03 | 12.85% | 2.84% | -14.74% | 17.03% | |
78 Outperform | $100.07B | 8.77 | 18.32% | 4.32% | 25.64% | 17.13% | |
78 Outperform | $67.93B | 8.90 | 9.83% | 2.18% | 16.06% | 64.31% | |
77 Outperform | $56.43B | 9.00 | 13.80% | 4.52% | 10.03% | 29.51% | |
75 Outperform | $68.21B | 10.71 | 12.08% | 5.01% | 1.13% | -1.14% | |
67 Neutral | $17.02B | 11.60 | 9.79% | 3.95% | 10.61% | 2.06% |
* Financial Sector Average
Performance Comparison
NWG
NatWest Group
14.14
5.77
68.94%
BBVA
Banco Bilbao
18.12
8.89
96.32%
BCS
Barclays
19.75
8.82
80.70%
HSBC
HSBC Holdings
62.95
23.87
61.08%
ING
ING Groep
23.94
8.03
50.47%
SAN
Banco Santander SA
9.08
4.68
106.36%
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.