Regional Banks Stocks Q3 Recap: Benchmarking The Bancorp (NASDAQ:TBBK)

Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at The Bancorp (NASDAQ:TBBK) and the best and worst performers in the regional banks industry.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 98 regional banks stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.3%.

Thankfully, share prices of the companies have been resilient as they are up 8.6% on average since the latest earnings results.

Weakest Q3: The Bancorp (NASDAQ:TBBK)

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp (NASDAQ:TBBK) is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.7 million, up 38.8% year on year. This print fell short of analysts’ expectations by 9.9%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ revenue estimates and a significant miss of analysts’ net interest income estimates.

“We had another successful quarter as we continue to build new Fintech capabilities and implement and expand partner programs,” said Damian Kozlowski, CEO of The Bancorp.

The Bancorp delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 8.3% since reporting and currently trades at $70.82.

Is now the time to buy The Bancorp? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Customers Bancorp (NYSE:CUBI)

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp (NYSE:CUBI) is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $231.8 million, up 38.3% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 19% since reporting. It currently trades at $78.00.

Is now the time to buy Customers Bancorp? Access our full analysis of the earnings results here, it’s free for active Edge members.

ServisFirst Bancshares (NYSE:SFBS)

Founded in 2005 with a focus on serving underserved mid-sized businesses, ServisFirst Bancshares (NYSE:SFBS) is a bank holding company that provides commercial banking services to businesses and professionals through its subsidiary ServisFirst Bank.

ServisFirst Bancshares reported revenues of $144.1 million, up 16.5% year on year, falling short of analysts’ expectations by 1.8%. It was a softer quarter as it posted a significant miss of analysts’ net interest income estimates and a significant miss of analysts’ EPS estimates.

As expected, the stock is down 3.3% since the results and currently trades at $73.80.

Read our full analysis of ServisFirst Bancshares’s results here.

Banc of California (NYSE:BANC)

Originally established in 1941 and now operating with a tech-forward approach that includes its SmartStreet platform for homeowner associations, Banc of California (NYSE:BANC) is a California-based bank holding company that provides banking services to small and middle-market businesses, entrepreneurs, and individuals.

Banc of California reported revenues of $287.7 million, up 4% year on year. This number topped analysts’ expectations by 1.6%. Overall, it was a strong quarter as it also recorded a beat of analysts’ EPS estimates and a decent beat of analysts’ revenue estimates.

The stock is up 16.6% since reporting and currently trades at $19.68.

Read our full, actionable report on Banc of California here, it’s free for active Edge members.

First Financial Bancorp (NASDAQ:FFBC)

Tracing its roots back to 1863 during the Civil War era, First Financial Bancorp (NASDAQ:FFBC) is a bank holding company that provides commercial banking, lending, deposit services, and wealth management to individuals and businesses.

First Financial Bancorp reported revenues of $234.4 million, up 9.3% year on year. This print beat analysts’ expectations by 2.7%. Aside from that, it was a mixed quarter as it also logged an impressive beat of analysts’ tangible book value per share estimates but a narrow beat of analysts’ EPS estimates.

The stock is up 6.1% since reporting and currently trades at $25.80.

Read our full, actionable report on First Financial Bancorp here, it’s free for active Edge members.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.