Sallie Mae Q4 Earnings & Revenues Miss Estimates, Expenses Rise

Sallie Mae SLM reported fourth-quarter 2024 earnings per share of 50 cents, which missed the Zacks Consensus Estimate of 54 cents. The bottom line decreased from the prior-year quarter’s 72 cents. Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.A rise in non-interest expenses negatively impacted SLM’s results. However, lower provisions for credit losses and robust loan originations, along with a rise in net interest income (NII), acted as tailwinds.The company’s GAAP net income was $112 million compared with $168 million in the prior-year quarter.In 2024, earnings of $2.68 per share missed the consensus estimate of $2.72. However, the metric rose from $2.41 in 2023. Net income was $608 billion, up 46.8% from the prior-year quarter.Sallie Mae’s NII & Expenses ClimbFourth-quarter NII totaled $362 million, up 0.8% year over year. However, the reported figure missed the Zacks Consensus Estimate by 2.5%. The quarterly net interest margin was 4.9%, down 45 basis points from the prior-year quarter's level.For 2024, NII was $1.48 billion, which missed the Zacks Consensus Estimate of $1.49 billion. Also, the top line declined 5.2% year over year.Non-interest income amounted to $28 million, up 16.7% year over year.Non-interest expenses inched up 12.8% year over year to $150 million.SLM’s Credit Quality: Mixed BagProvision for credit losses was $108 million, up from $16 million reported in the prior-year quarter.Net charge-offs for private education loans were $93 million, up marginally year over year. Private education loans held for investment net charge-offs, as a percentage of average private education loans held for investment in repayment (annualized), was 2.38%. The figure contracted 5 basis points year over year.Sallie Mae’s Balance Sheet Position: Mixed BagAs of Dec. 31, 2024, deposits were $21.1 billion, down 1.7% sequentially.Private education loans held for investment were $20.9 billion, up marginally  from the prior year quarter reported figure.In the reported quarter, the company’s private education loan originations increased 10% from the year-ago quarter.SLM’s Share Repurchase UpdateIn the fourth quarter, SLM repurchased 11.6 million shares for $250 million under its 2024 share buyback program.Sallie Mae’s 2025 OutlookThe company expects diluted earnings per share to be in the range of $3-$3.10.It anticipates total loan portfolio net charge-offs as a percentage of average loans in repayment in the band of 2-2.2%.Private education loan originations are expected to grow 6-8% year over year.SLM’s non-interest expenses are expected to be in the range of $655-$675 million.Final Thoughts on SLMSallie Mae’s overall financial performance seems decent. Robust loan origination, rise in NII and lower provisions for credit loss are positives. However, a rise in non-interest expenses was a major near-term headwind.SLM Corporation Price, Consensus and EPS Surprise SLM Corporation price-consensus-eps-surprise-chart | SLM Corporation QuoteCurrently, SLM carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performances of Other BanksHancock Whitney Corp.’s HWC fourth-quarter 2024 earnings per share of $1.40 easily beat the Zacks Consensus Estimate of $1.28. The bottom line compared favorably with $1.26 reported in the year-ago quarter.The results benefited from the increase in non-interest income and NII. Lower expenses and provisions were other positives. However, the decline in total loans was a headwind for HWC.Bank OZK’s OZK fourth-quarter 2024 earnings per share of $1.56 handily surpassed the Zacks Consensus Estimate of $1.45. The bottom line reflects a rise of 4% from the prior-year quarter’s actual.OZK’s results benefited from a rise in NII, driven by improvement in loans and deposit balances. Lower non-interest expenses and provisions were also positives. However, lower non-interest income and rising funding costs were the undermining factors.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>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 SLM Corporation (SLM): Free Stock Analysis Report Hancock Whitney Corporation (HWC): Free Stock Analysis Report Bank OZK (OZK): 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