Webster Financial (WBS) AI Stock Analysis

• Market Cap: $10.40B
• Dividend Yield: 2.59%
• Average Volume (3M): 1.52M
• Price to Earnings (P/E): 12.6
• Beta (1Y): 1.42
• Revenue Growth: 4.65%
• EPS Growth: 7.12%
• Country: US
• Employees: 4,297
• Sector: Financial
• Sector Strength: 72
• Industry: Banks - Regional
• EPS (TTM): 1.53
• Shares Outstanding: 168,229,100
• 10 Day Avg. Volume: 1,746,941
• 30 Day Avg. Volume: 1,515,880
• PEG Ratio: 7.05
• Price to Book (P/B): 0.96
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.19
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 0.61
• Enterprise Value/Gross Profit: 4.27
• Enterprise Value/Ebitda: 2.35
• 1Y Price Target: $70.08
• Price Target Upside: 16.37% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 13

• Rating: 79 Outperform
• Price Target: $65.00 ▲(7.94%Upside)

Webster Financial's strong financial performance, coupled with positive technical indicators and strategic corporate actions, contribute to an overall favorable outlook. Key strengths include robust profitability, effective cash flow management, and a solid market position. While minor challenges in operational efficiency and competitive pressures exist, the company's strategic initiatives and growth potential provide a positive investment case.

Positive Factors

Credit Trends

Credit trends were a highlight with nonperforming and commercial classified loans both decreasing, alongside a decline in net charge offs.

Earnings Performance

4Q24 earnings exceeded expectations, with operating EPS beating consensus due to higher net interest income and fees.

Loan Growth

Loan growth showed positive momentum with end of period balances increasing and originations accelerating across major segments.

Negative Factors

Asset Quality

Asset quality metrics deteriorated, as evidenced by an increase in nonperforming and commercial classified loans.

Webster Financial Business Overview & Revenue Model

Company Description

Webster Financial Corporation is a leading regional bank holding company headquartered in Stamford, Connecticut. The company primarily operates through its subsidiary, Webster Bank, offering a range of financial services including personal banking, commercial banking, and wealth management. Webster Bank serves a diverse client base across the Northeast United States, providing products such as checking and savings accounts, loans, mortgages, and investment services. The company's commitment to customer service and community involvement underscores its position as a trusted financial partner.

How the Company Makes Money

Webster Financial makes money primarily through the interest income generated from its lending activities, including personal loans, commercial loans, and mortgages. The bank earns interest on the loans and mortgages it provides to individuals and businesses, which constitutes a significant portion of its revenue. Additionally, Webster Financial generates non-interest income through fees and service charges associated with its banking services, including account maintenance fees, transaction fees, and wealth management advisory fees. The company also benefits from investments made with customer deposits, further contributing to its earnings. Strategic partnerships and community banking initiatives enhance its market presence and customer acquisition, supporting its overall revenue model.

Webster Financial Financial Statement Overview

Summary

Webster Financial shows solid profitability with a net profit margin of 18.6% and a stable gross profit margin of 56.6%. Revenue growth is positive at 5.68%, but operational costs have increased as indicated by a declining EBIT margin. The balance sheet is strong with a low debt-to-equity ratio of 0.42, and cash flow management is robust with an operating cash flow to net income ratio of 1.61.

Income Statement

Webster Financial shows a stable performance with a Gross Profit Margin of 56.6% for TTM (Trailing-Twelve-Months), indicating efficient cost management. The Net Profit Margin is healthy at 18.6%, reflecting strong profitability. Revenue has grown by 5.68% compared to the previous year, showcasing positive growth. However, the EBIT Margin has slightly declined to 24.2%, which may indicate rising operational costs.

Balance Sheet

The company's Debt-to-Equity Ratio stands at 0.42, which is relatively low, suggesting prudent leverage management. Return on Equity is solid at 8.47%, indicating effective use of equity to generate income. The Equity Ratio of 11.46% showcases a balanced approach to asset financing, though there is room for strengthening the equity base to enhance financial stability.

Cash Flow

Webster Financial demonstrates robust cash flow management, with Operating Cash Flow to Net Income Ratio at 1.61, indicating strong cash generation relative to profits. The Free Cash Flow to Net Income Ratio is commendable at 1.56, reflecting effective capital expenditure management. While Free Cash Flow growth is slightly negative at -11.10%, the overall cash flow position remains healthy.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.19B	4.17B	3.94B	2.72B	1.26B	1.29B
Gross Profit	2.37B	2.36B	2.50B	2.19B	1.28B	1.04B
EBITDA	1.09B	1.09B	1.16B	879.78M	575.37M	323.15M
Net Income	779.30M	768.71M	867.84M	644.28M	408.86M	220.62M
Balance Sheet
Total Assets	80.28B	79.03B	74.95B	71.28B	34.92B	32.59B
Cash, Cash Equivalents and Short-Term Investments	2.52B	2.08B	10.68B	8.73B	4.70B	3.59B
Total Debt	3.90B	3.36B	3.87B	7.69B	1.39B	1.88B
Total Liabilities	71.08B	69.89B	66.26B	63.22B	31.48B	29.36B
Stockholders Equity	9.20B	9.13B	8.69B	8.06B	3.44B	3.23B
Cash Flow
Free Cash Flow	1.22B	1.37B	938.35M	1.31B	672.00M	359.27M
Operating Cash Flow	1.26B	1.40B	978.65M	1.34B	688.59M	380.55M
Investing Cash Flow	-3.26B	-3.87B	-2.60B	-7.19B	-2.41B	-2.29B
Financing Cash Flow	2.97B	2.82B	2.49B	6.23B	1.91B	1.91B

Webster Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 60.22
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WBS, the sentiment is Positive. The current price of 60.22 is above the 20-day moving average (MA) of 58.63, above the 50-day MA of 54.91, and above the 200-day MA of 53.58, indicating a bullish trend. The MACD of 1.93 indicates Negative momentum. The RSI at 61.18 is Neutral, neither overbought nor oversold. The STOCH value of 83.17 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WBS.

Webster Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WBS	79 Outperform	$10.40B	12.56	9.49%	2.59%	4.65%	7.12%
CFR	78 Outperform	$8.70B	15.03	15.26%	2.84%	5.99%	7.75%
CMA	76 Outperform	$8.76B	12.80	11.07%	4.21%	-7.80%	15.43%
CBSH	74 Outperform	$8.36B	15.12	16.36%	1.70%	14.15%	17.71%
WAL	72 Outperform	$9.22B	10.99	12.58%	1.81%	7.06%	14.94%
PNFP	70 Outperform	$8.30B	14.18	9.32%	0.88%	10.19%	48.39%
Sector *	61 Neutral	C$15.12B	7.06	23.28%	5.39%	33.61%	-23.38%

Webster Financial Corporate Events

Webster Financial Announces Executive Resignation

On July 18, 2025, Albert J. Wang announced his resignation as Executive Vice President and Chief Accounting Officer of Webster Financial Corporation and Webster Bank, effective September 2, 2025, to pursue another professional opportunity. Gregory S. Madar will assume the role of Interim Chief Accounting Officer starting September 3, 2025, while the company searches for a permanent replacement.

The most recent analyst rating on (WBS) stock is a Buy with a $66.00 price target. To see the full list of analyst forecasts on Webster Financial stock, see the WBS Stock Forecast page.

Webster Financial Reports Strong Q2 2025 Results

Webster Financial Corporation reported strong financial results for the second quarter of 2025, with net income applicable to common stockholders of $251.7 million, or $1.52 per diluted share, compared to $175.5 million, or $1.03 per diluted share, in the same quarter of 2024. The company experienced growth in revenue, loans, and deposits, with improved asset quality metrics and a lower provision for credit losses. The financial performance highlights Webster’s solid growth and strategic positioning, indicating a positive outlook for future business opportunities and shareholder returns.

The most recent analyst rating on (WBS) stock is a Buy with a $66.00 price target. To see the full list of analyst forecasts on Webster Financial stock, see the WBS Stock Forecast page.

Webster Financial Appoints New Board Member and CRO

On June 25, 2025, Webster Financial Corporation announced the appointment of Frederick J. Crawford to its Board of Directors, effective July 1, 2025, expanding the board from 12 to 13 members. Crawford, recognized as an independent director and financial expert, will serve on the Audit and Risk Committees. Additionally, Jason E. Schugel was appointed as Chief Risk Officer and Executive Vice President, effective July 14, 2025, succeeding Daniel Bley, who will retire but remain temporarily in an advisory role. Schugel brings extensive experience in risk management from his previous role at Ally Bank. These appointments are expected to enhance Webster’s strategic capabilities and governance as it continues to grow and navigate the regulatory landscape.

The most recent analyst rating on (WBS) stock is a Buy with a $66.00 price target. To see the full list of analyst forecasts on Webster Financial stock, see the WBS Stock Forecast page.

Webster Financial Concludes Successful Annual Stockholders Meeting

On May 21, 2025, Webster Financial Corporation held its 2025 Annual Meeting of Stockholders, where 89.7% of shares were represented. During the meeting, stockholders elected twelve directors for one-year terms, approved executive compensation on a non-binding basis, and ratified KPMG LLP as the independent auditor for the fiscal year ending December 31, 2025.

The most recent analyst rating on (WBS) stock is a Buy with a $75.00 price target. To see the full list of analyst forecasts on Webster Financial stock, see the WBS Stock Forecast page.