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Here's Why Wintrust Financial (WTFC) Stock Worth Buying Now
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At present, the banking industry is facing a challenging operating backdrop amid high interest rates and waning loan demand. Despite this, one can bet on fundamentally solid lenders like Wintrust Financial Corporation (WTFC - Free Report) . The company is well-placed to benefit from solid loan and deposit balances, high interest rates and a strong balance sheet.
Analysts seem optimistic regarding the company’s earnings growth potential. Over the past month, the Zacks Consensus Estimate for WTFC’s earnings has been revised marginally and 1.1% upward for 2023 and 2024, respectively. The stock presently carries a Zacks Rank #2 (Buy).
Shares of WTFC have rallied 9.2% over the past three months, outperforming the industry’s 4% rise.
Image Source: Zacks Investment Research
Some factors that make Wintrust Financial an attractive choice right now.
Earnings Growth: In the last three to five years, WTFC witnessed earnings growth of 10.8%, higher than the industry average of 10.3%. The trend is expected to continue in the near term, with earnings anticipated to rise 24.3% this year.
Revenue Strength: The company’s net revenues witnessed a CAGR of 11.2% over the five years ended 2022. The improvement was driven by solid loan and deposit balance and efforts to bolster fee income. Further, since 2022, higher interest rates have aided WTFC’s top line.
In April, the company, through its subsidiary, acquired two asset management businesses – Rothschild & Co Asset Management US Inc. and Rothschild & Co Risk Based Investments LLC – from Rothschild & Co North America Inc. Wintrust Financial acquired roughly $12.6 million in assets.
Given the decent loan demand and rise in fee income, the company’s revenues will likely trend upward, while rising funding costs will weigh on it. The top line is expected to rise 15% in 2023 and 1.1% next year.
Steady Capital Distributions: Wintrust Financial has been paying quarterly dividends regularly. Also, over the last five years, the company has hiked dividends five times, with payout growing 13.87% over the same time frame. WTFC's payout ratio currently stands at 17% of earnings. Given the solid balance sheet, the company’s dividend payouts seem sustainable.
Favorable Valuation: WTFC stock has a Value Score of A. Our research shows that stocks with a Value Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Other Banks Worth a Look
A couple of other top-ranked stocks from the banking space are Northeast Community Bancorp, Inc. (NECB - Free Report) and First Internet Bancorp (INBK - Free Report) .
Northeast Community Bancorp currently sports a Zacks Rank #1. Earnings estimates for 2023 have been revised 10% north in the past 60 days. In the past three months, NECB’s shares have rallied 7.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings estimates for First Internet Bancorp have been revised 14.3% north for 2023 over the past 60 days. Shares of INBK have risen 15.8% in the past three months. Currently, the company carries a Zacks Rank #2.
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Here's Why Wintrust Financial (WTFC) Stock Worth Buying Now
At present, the banking industry is facing a challenging operating backdrop amid high interest rates and waning loan demand. Despite this, one can bet on fundamentally solid lenders like Wintrust Financial Corporation (WTFC - Free Report) . The company is well-placed to benefit from solid loan and deposit balances, high interest rates and a strong balance sheet.
Analysts seem optimistic regarding the company’s earnings growth potential. Over the past month, the Zacks Consensus Estimate for WTFC’s earnings has been revised marginally and 1.1% upward for 2023 and 2024, respectively. The stock presently carries a Zacks Rank #2 (Buy).
Shares of WTFC have rallied 9.2% over the past three months, outperforming the industry’s 4% rise.
Image Source: Zacks Investment Research
Some factors that make Wintrust Financial an attractive choice right now.
Earnings Growth: In the last three to five years, WTFC witnessed earnings growth of 10.8%, higher than the industry average of 10.3%. The trend is expected to continue in the near term, with earnings anticipated to rise 24.3% this year.
Revenue Strength: The company’s net revenues witnessed a CAGR of 11.2% over the five years ended 2022. The improvement was driven by solid loan and deposit balance and efforts to bolster fee income. Further, since 2022, higher interest rates have aided WTFC’s top line.
In April, the company, through its subsidiary, acquired two asset management businesses – Rothschild & Co Asset Management US Inc. and Rothschild & Co Risk Based Investments LLC – from Rothschild & Co North America Inc. Wintrust Financial acquired roughly $12.6 million in assets.
Given the decent loan demand and rise in fee income, the company’s revenues will likely trend upward, while rising funding costs will weigh on it. The top line is expected to rise 15% in 2023 and 1.1% next year.
Steady Capital Distributions: Wintrust Financial has been paying quarterly dividends regularly. Also, over the last five years, the company has hiked dividends five times, with payout growing 13.87% over the same time frame. WTFC's payout ratio currently stands at 17% of earnings. Given the solid balance sheet, the company’s dividend payouts seem sustainable.
Favorable Valuation: WTFC stock has a Value Score of A. Our research shows that stocks with a Value Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
Other Banks Worth a Look
A couple of other top-ranked stocks from the banking space are Northeast Community Bancorp, Inc. (NECB - Free Report) and First Internet Bancorp (INBK - Free Report) .
Northeast Community Bancorp currently sports a Zacks Rank #1. Earnings estimates for 2023 have been revised 10% north in the past 60 days. In the past three months, NECB’s shares have rallied 7.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings estimates for First Internet Bancorp have been revised 14.3% north for 2023 over the past 60 days. Shares of INBK have risen 15.8% in the past three months. Currently, the company carries a Zacks Rank #2.