Natwest Group Plc (NWG)
NYSE:NWG
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NatWest Group
(NYSE:NWG)
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Rating:58Neutral
Price Target:
$15.00
â–¼(-8.42% Downside)
Action:DowngradedDate:02/18/26
The score is driven primarily by mid-range financial performance—good profitability and an improving balance sheet, but weighed down by volatile revenue and inconsistent cash flow. Technicals are weak with bearish trend signals despite oversold readings. Valuation is a clear positive with a low P/E and supported dividend yield, while the earnings call was constructive on returns and capital generation but highlighted meaningful macro, regulatory, and acquisition execution risks.
Positive Factors
Capital generation & CET1 strength
Consistent, multi-hundred-basis-point capital generation and a 14% CET1 ratio materially strengthen loss-absorbing capacity and strategic optionality. This durable capital build supports dividends/buybacks, buffers impending RWA changes, and underpins capacity for acquisitions and lending over the medium term.
Negative Factors
Weak cash generation
Recurrent negative operating and free cash flow in several years signals that reported earnings have not consistently converted to cash. This reduces financial flexibility, increases reliance on wholesale funding and capital markets, and constrains the bank's ability to absorb shocks or fund organic growth without raising costs or capital.
Read all positive and negative factors
Positive Factors
Negative Factors
Capital generation & CET1 strength
Consistent, multi-hundred-basis-point capital generation and a 14% CET1 ratio materially strengthen loss-absorbing capacity and strategic optionality. This durable capital build supports dividends/buybacks, buffers impending RWA changes, and underpins capacity for acquisitions and lending over the medium term.
Read all positive factors
NatWest Group (NWG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$64.92B
Dividend Yield3.67%
Average Volume (3M)4.32M
Price to Earnings (P/E)4.5
Beta (1Y)1.09
Revenue Growth7.43%
EPS Growth30.31%
CountryUS
Employees59,400
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)0.47
Shares Outstanding3,990,569,300
10 Day Avg. Volume3,902,443
30 Day Avg. Volume4,320,940
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)0.61
Price to Sales (P/S)0.89
P/FCF Ratio4.52
Enterprise Value/Market Cap0.53
Enterprise Value/Revenue1.18
Enterprise Value/Gross Profit2.09
Enterprise Value/Ebitda3.92
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.92
Revenue Forecast (FY)$24.05B
NatWest Group Business Overview & Revenue Model
Company Description
NatWest 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, ...
How the Company Makes Money
NatWest Group makes money mainly by intermediating deposits and lending, charging for banking services, and earning fees from related financial products. Key revenue streams include: (1) Net interest income: the spread between interest earned on a...
NatWest Group Key Performance Indicators (KPIs)
Any
Total Income by Segment
Details the total income generated by each segment, offering a clear view of which parts of the business are contributing most to overall revenue.
Details the total income generated by each segment, offering a clear view of which parts of the business are contributing most to overall revenue.
Data provided by:
The Fly
The FlyNatWest Group Earnings Call Summary
Earnings Call Date:Feb 13, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 01, 2026
Earnings Call Sentiment Positive
The call presented a strong operating performance in 2025 with double‑digit income growth, robust lending and AUMA expansion, meaningful cost savings and high capital generation. Management set ambitious 2028 targets (RoTE >18%, CAL growth >4% p.a., cost/income <45%, CET1 ~13%) and articulated strategic rationale for the Evelyn Partners acquisition to accelerate wealth capabilities. Key risks highlighted include near‑term rate cut headwinds, regulatory RWA increases (Basel 3.1/CRD IV), integration and day‑one CET1 impact from the Evelyn deal, and sensitivity of future hedge income to reinvestment rates. On balance the positives (growth, profitability, capital generation, efficiency gains and strategic scale in wealth) outweigh the manageable and disclosed risks, though outcomes remain sensitive to macro, regulatory and execution dynamics.Positive Updates
Strong top-line and profitability
Income (excluding notable items) grew 12% to GBP 16.4bn, operating profit was GBP 7.7bn and profit attributable to ordinary shareholders was GBP 5.5bn. Return on tangible equity was 19.2% and EPS rose 27% to 68p.
Negative Updates
Rate and hedging uncertainties
Management expects Bank Rate cuts in 2026 (terminal ~3.25% end-2026) which are modeled to be a GBP ~500m drag on income in 2026; hedge assumptions and reinvestment yields drive material earnings sensitivity (management expects hedge income to increase ~GBP 1.5bn in 2026 vs 2025 but this depends on reinvestment yields and notional growth).
Read all updates
Q4-2025 Updates
Positive
Negative
Strong top-line and profitability
Income (excluding notable items) grew 12% to GBP 16.4bn, operating profit was GBP 7.7bn and profit attributable to ordinary shareholders was GBP 5.5bn. Return on tangible equity was 19.2% and EPS rose 27% to 68p.
Read all positive updates
Company Guidance
The management guided that, excluding Evelyn Partners, 2026 income (ex-notables) is expected to be GBP 17.2–17.6bn with other operating expenses around GBP 8.2bn, a loan impairment rate below 25bps and capital generation of ~200bps before distributions (2026 guidance excludes the Jan‑1‑2027 Basel 3.1 ~GBP 10bn RWA impact); they expect RoTE >17% in 2026 and reiterated a CET1 operating target of around 13%. Longer‑term 2028 targets include CAL growth >4% p.a. (2025–28), a cost/income ratio <45%, >200bps capital generation before distributions while operating at ~13% CET1, and RoTE >18% with a c.50% dividend payout ratio (with scope for buybacks). Management also expects strong hedge tailwinds (2026 hedge income ~GBP 1.5bn higher than 2025, 2027 ~GBP 1bn higher than 2026, targeting total hedge income ~GBP 7.2bn by 2027), product/equity hedge yield rising (c.2.4% in 2025 to ~3.1% in 2026) and hedge notional increasing (c.£198bn → ~£200bn), ECL provisioning of c.£3.6bn with coverage ~83bps, and a through‑the‑cycle cost‑of‑risk framework of 20–30bps.NatWest Group Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
64
Positive
Cash Flow
34
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 29.48B | 28.57B | 24.76B | 16.15B | 12.04B |
| Gross Profit | 16.61B | 14.65B | 14.78B | 13.35B | 10.34B |
| EBITDA | 8.86B | 7.25B | 7.11B | 5.96B | 4.77B |
| Net Income | 5.83B | 4.80B | 4.64B | 3.59B | 3.27B |
Balance Sheet | |||||
| Total Assets | 714.55B | 707.99B | 692.67B | 720.05B | 781.99B |
| Cash, Cash Equivalents and Short-Term Investments | 98.23B | 106.93B | 116.47B | 154.98B | 261.23B |
| Total Debt | 71.83B | 65.92B | 60.07B | 55.32B | 58.33B |
| Total Liabilities | 671.94B | 668.61B | 655.49B | 683.56B | 740.19B |
| Stockholders Equity | 42.60B | 39.35B | 37.16B | 36.49B | 41.80B |
Cash Flow | |||||
| Free Cash Flow | 5.79B | 694.00M | -18.99B | -44.24B | 52.79B |
| Operating Cash Flow | 7.07B | 1.77B | -17.44B | -43.60B | 53.69B |
| Investing Cash Flow | -13.77B | -12.70B | -14.69B | 19.06B | 3.06B |
| Financing Cash Flow | -3.49B | -1.89B | -6.30B | -10.65B | -2.60B |
NatWest Group Technical Analysis
Positive
16.38
Price Trends
15.73
Positive
15.97
Positive
14.84
Positive
Market Momentum
0.02
Negative
64.55
Neutral
82.70
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 16.38 is above the 20-day moving average (MA) of 14.81, above the 50-day MA of 15.73, and above the 200-day MA of 14.84, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 64.55 is Neutral, neither overbought nor oversold. The STOCH value of 82.70 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
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $129.78B | 11.69 | 18.53% | 3.27% | 7.52% | 10.40% | |
72 Outperform | $179.02B | 10.97 | 13.89% | 1.85% | -15.34% | 16.71% | |
71 Outperform | $307.25B | 12.28 | 11.88% | 4.14% | -9.54% | -22.46% | |
71 Outperform | $80.01B | 11.24 | 12.46% | 4.14% | 2.20% | -0.17% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
60 Neutral | $80.00B | 11.28 | 9.41% | 1.71% | 17.50% | 49.25% | |
58 Neutral | $64.92B | 4.48 | 14.33% | 3.67% | 7.43% | 30.31% |
* Financial Sector Average
NWG
NatWest Group
16.41
5.78
54.43%
BBVA
Banco Bilbao
23.39
11.04
89.33%
BCS
Barclays
23.40
10.10
75.99%
HSBC
HSBC Holdings
90.27
44.44
96.99%
ING
ING Groep
28.64
12.16
73.80%
SAN
Banco Santander SA
12.18
6.08
99.80%
NatWest Group Corporate Events
NatWest Discloses Capital Group Stake Dip Below 5% Threshold
Mar 26, 2026
NatWest Group plc disclosed that The Capital Group Companies, Inc., a major U.S.-based investment management group, has reduced its holding in NatWest to 4.991397% of voting rights as of 24 March 2026, from a previous level of 5.005597%. The posit...
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.