Webster Financial (WBS)
NYSE:WBS
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Webster Financial
(NYSE:WBS)
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Rating:76Outperform
Price Target:
$82.00
â–²(11.76% Upside)
Action:ReiteratedDate:05/01/26
WBS scores well on financial performance (solid profitability, cash conversion, and a conservatively positioned balance sheet) and is supported by a constructive technical setup. Valuation is reasonable for the group, while the latest earnings call was broadly positive but flagged deposit competition, higher expenses, and remaining problem-loan pockets. The pending Santander acquisition adds a meaningful positive corporate catalyst, tempered by approval/closing conditions.
Positive Factors
High profitability and returns
Sustained high ROTCE and improving ROA signal durable earnings power and efficient capital allocation. This level of profitability supports ongoing buybacks, dividend flexibility and reinvestment into growth initiatives, increasing resilience across economic cycles.
Negative Factors
Concentrated problem loan pockets
Persisting concentrations in office and health-care loans create outsized credit exposure and loss-risk relative to portfolio size. Even if ring-fenced and reserved, they require ongoing remediation, can tie up capital, and complicate credit allocation and provisioning over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability and returns
Sustained high ROTCE and improving ROA signal durable earnings power and efficient capital allocation. This level of profitability supports ongoing buybacks, dividend flexibility and reinvestment into growth initiatives, increasing resilience across economic cycles.
Read all positive factors
Webster Financial (WBS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.78B
Dividend Yield2.49%
Average Volume (3M)3.50M
Price to Earnings (P/E)11.2
Beta (1Y)1.27
Revenue Growth5.84%
EPS Growth37.42%
CountryUS
Employees4,297
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)6.12
Shares Outstanding162,026,500
10 Day Avg. Volume2,792,451
30 Day Avg. Volume3,504,541
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)1.06
Price to Sales (P/S)2.28
P/FCF Ratio10.00
Enterprise Value/Market Cap1.45
Enterprise Value/Revenue3.92
Enterprise Value/Gross Profit6.32
Enterprise Value/Ebitda12.93
Forecast
1Y Price Target
$73.56Price Target Upside0.26% Upside
Rating ConsensusHold
Number of Analyst Covering9
EPS Forecast (FY)6.6
Revenue Forecast (FY)$3.05B
Webster Financial Business Overview & Revenue Model
Company Description
Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides a range of banking, investment, and financial services to individuals, families, and businesses in the United States. It operat...
How the Company Makes Money
Webster Financial makes money primarily through (1) net interest income and (2) noninterest (fee-based) income.
1) Net interest income (core banking spread): The bank earns interest and fees on loans and other interest-earning assets—such as comm...
Webster Financial Earnings Call Summary
Earnings Call Date:Jan 23, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 16, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a positive operational and financial performance profile: solid full-year profitability and capital generation, diversified loan growth, improving credit metrics, and strategic investments in growth verticals. Headwinds include elevated deposit competition, some near-term expense pressure from investments, GAAP adjustments in the quarter, and two remaining concentrated problem loan pools (office and health care) that are being actively managed. Management provided conservative but constructive guidance for 2026 with capital return optionality intact.Positive Updates
Strong Profitability and Returns
Full-year 2025 ROTCE of 17% and ROA of 1.2%; EPS increased 10% year-over-year, indicating improved profitability and shareholder value.
Negative Updates
Quarterly GAAP Adjustments Reduced Reported Earnings
Q4 had adjustments that reduced pretax income by $8M and after-tax income by $6M; excluding adjustments, adjusted PPNR was down $4.9M QoQ, highlighting some volatility between GAAP and adjusted results.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Profitability and Returns
Full-year 2025 ROTCE of 17% and ROA of 1.2%; EPS increased 10% year-over-year, indicating improved profitability and shareholder value.
Read all positive updates
Company Guidance
The company guided to 2026 loan growth of 5%–7% and deposit growth of 4%–6%, with midpoint revenue of $3.0 billion and GAAP net interest income of $2.57–2.63 billion (assuming two 25 bp Fed cuts), fees of $390–410 million and expenses of $1.46–1.48 billion (a few percentage points above Q4 adjusted levels); management expects a roughly flat full‑year NIM in the mid‑3.30% range (exit/December NIM 3.35%) and modeled a ~30% deposit beta. They reaffirmed a strong capital posture (CET1 ~11.2% today, near‑term target ~11%, long‑term target 10.5%), continued share repurchases (10.9 million shares repurchased in 2025, 3.6 million in Q4), and projected HSA Bank could add $1.0–2.5 billion of deposits over five years (including $50–100 million in 2026); recent operating metrics cited included Q4 assets up $880 million (1%), loans up $1.5 billion (2.8%) and +7.8% year, deposits +0.9% Q/Q (+6% year), ROTCE 17%, ROA 1.2%, EPS +10% YoY, tangible book value +13% YoY ($37.20 vs. $36.42), charge‑offs ~35 bps, allowance down $9 million Q/Q, NPAs down 8% and commercial classified loans down 7%.Webster Financial Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
78
Positive
Cash Flow
71
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.35B | 4.42B | 4.17B | 3.94B | 2.72B | 1.26B |
| Gross Profit | 2.70B | 2.69B | 2.36B | 2.50B | 2.19B | 1.28B |
| EBITDA | 1.32B | 1.26B | 1.09B | 1.16B | 879.78M | 575.37M |
| Net Income | 1.02B | 1.00B | 768.71M | 867.84M | 644.28M | 408.86M |
Balance Sheet | ||||||
| Total Assets | 85.58B | 84.07B | 79.03B | 74.95B | 71.28B | 34.92B |
| Cash, Cash Equivalents and Short-Term Investments | 18.77B | 2.46B | 2.08B | 10.68B | 8.73B | 4.70B |
| Total Debt | 738.31M | 4.32B | 3.36B | 3.87B | 7.69B | 1.39B |
| Total Liabilities | 76.01B | 74.58B | 69.89B | 66.26B | 63.22B | 31.48B |
| Stockholders Equity | 9.57B | 9.49B | 9.13B | 8.69B | 8.06B | 3.44B |
Cash Flow | ||||||
| Free Cash Flow | 1.20B | 1.01B | 1.37B | 938.35M | 1.31B | 672.00M |
| Operating Cash Flow | 1.25B | 1.06B | 1.40B | 978.65M | 1.34B | 688.59M |
| Investing Cash Flow | -5.37B | -4.75B | -3.87B | -2.60B | -7.19B | -2.41B |
| Financing Cash Flow | 4.47B | 4.06B | 2.82B | 2.49B | 6.23B | 1.91B |
Webster Financial Technical Analysis
Positive
73.37
Price Trends
70.60
Positive
67.04
Positive
62.46
Positive
Market Momentum
0.95
Negative
66.75
Neutral
87.94
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 73.37 is above the 20-day moving average (MA) of 70.35, above the 50-day MA of 70.60, and above the 200-day MA of 62.46, indicating a bullish trend. The MACD of 0.95 indicates Negative momentum. The RSI at 66.75 is Neutral, neither overbought nor oversold. The STOCH value of 87.94 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WBS.
Webster Financial Risk Analysis
Webster Financial disclosed 47 risk factors in its most recent earnings report. Webster Financial 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
Webster Financial Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $9.97B | 8.21 | 11.67% | 1.37% | 41.57% | 41.57% | |
78 Outperform | $10.20B | 10.27 | 11.93% | 1.40% | 6.64% | 17.78% | |
76 Outperform | $11.78B | 11.24 | 10.80% | 2.49% | 5.84% | 37.42% | |
74 Outperform | $9.51B | 10.09 | 10.42% | 2.38% | 49.78% | 46.17% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $8.94B | 10.15 | 13.19% | 1.80% | 10.14% | 17.94% |
* Financial Sector Average
WBS
Webster Financial
72.69
23.90
48.99%
UMBF
UMB Financial
131.17
29.11
28.53%
WTFC
Wintrust Financial
151.18
35.47
30.66%
WAL
Western Alliance
82.31
8.78
11.94%
SSB
SouthState Corporation
97.36
9.89
11.30%
Webster Financial Corporate Events
Business Operations and StrategyM&A Transactions
Webster Financial to Be Acquired by Banco Santander
Positive
Feb 6, 2026
On February 3, 2026, Webster Financial Corporation entered into a transaction agreement under which Banco Santander will acquire Webster through a two-step structure: Webster will first merge into a Virginia-incorporated wholly owned Webster subsi...
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.