Popular Q3 Earnings Miss on Higher Provisions, Revenues Rise Y/Y

Popular, Inc.'s BPOP  third-quarter 2024 adjusted earnings per share of $2.16 missed the Zacks Consensus Estimate of $2.33. However, the bottom line increased 13.7% from the year-ago quarter.Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.The results were primarily affected by higher provisions and deteriorating capital position. Nonetheless, a rise in net interest income (NII), fee income and lower expenses were tailwinds.Popular’s Revenues Rise & Expenses Decline Y/YTotal quarterly revenues were $736.6 million, which missed the Zacks Consensus Estimate of $748.9 million. Nonetheless, the top line rose 6.2% from the year-ago quarter.Quarterly NII was $572.5 million, up 7.2% year over year. However, the net interest margin shrunk 17 basis points to 3.24%.Non-interest income increased 2.8% year over year to $164.1 million. The rise was primarily due to an increase in service charges on deposit accounts, other service fees, net gain on trading account debt securities and adjustments to indemnity reserves on loans sold. Total operating expenses declined marginally year over year to $467.3 million.BPOP’s Loans & Deposit Balances Rise SequentiallyAs of Sept. 30, 2024, total loans held-in-portfolio increased 1.7% on a sequential basis to $36.2 billion. Total deposits were $63.7 billion, which increased 2.8% from the previous quarter.Popular’s Credit Quality: Mixed BagIn the third quarter of 2024, Popular recorded a provision for credit losses of $71.4 million, up 58.4% from the prior-year quarter.As of Sept. 30, 2024, non-performing assets were $424.4 million, which declined 4.4% year over year.  The non-performing assets to total assets ratio was 0.60% compared with 0.64% as of Sept. 30, 2023.BPOP’s Capital Ratios Decline Y/YAs of Sept. 30, 2024, the Common Equity Tier 1 capital ratio and the Tier 1 capital ratio were 16.42% and 16.48%, respectively, compared with 16.81% and 16.87% in the year-ago quarter.Popular’s Share Repurchase UpdateIn the reported quarter, the company repurchased 599,096 shares for $58.8 million.Our View on BPOPPopular is well-poised to benefit from its business transformation efforts, along with significant progress in modernizing customer channels. A rise in loan and deposit balances will support its financials in the long term. However, rising provisions amid a challenging macroeconomic backdrop remain a major concern.Popular, Inc. Price, Consensus and EPS Surprise Popular, Inc. price-consensus-eps-surprise-chart | Popular, Inc. QuoteCurrently, Popular carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Popular’s PeersF.N.B. Corporation’s FNB third-quarter 2024 adjusted earnings per share of 34 cents lagged the Zacks Consensus Estimate of 36 cents. Moreover, the bottom line reflected a decline of 15% from the prior-year quarter’s level.FNB’s results were primarily affected by higher expenses and lower NII. Nonetheless, a higher non-interest income, lower provisions and a rise in average loans and deposits balance offered some support.Hancock Whitney Corp.’s HWC third-quarter 2024 earnings per share of $1.33 beat the Zacks Consensus Estimate of $1.31. The bottom line compared favorably with $1.12 per share registered in the year-ago quarter.HWC’s results were aided by an increase in non-interest income and net interest income (NII). Lower expenses and provisions were positives. However, the decline in total loans and deposits affected the results to some extent.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Popular, Inc. (BPOP): Free Stock Analysis Report F.N.B. Corporation (FNB): Free Stock Analysis Report Hancock Whitney Corporation (HWC): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks