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Hancock Whitney (HWC) Q4 Earnings Beat, Revenues Rise Y/Y

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Hancock Whitney Corporation’s (HWC - Free Report) fourth-quarter 2020 adjusted earnings per share of 96 cents surpassed the Zacks Consensus Estimate of 91 cents. However, the figure compared unfavorably with the prior-year quarter’s adjusted number of $1.06.

Results for the reported quarter benefitted from an increase in revenues along with lower expenses. However, a significant rise in provisions was an undermining factor. The balance sheet position remained strong in the quarter.

After considering non-recurring items, net income was $103.6 million or $1.17 per share, up from $92.1 million or $1.03 per share recorded in the prior-year quarter.

For 2020, loss per share was 54 cents against earnings of $3.72 recorded in 2019. Net loss was $45.2 million against net income of $327.4 million in the previous year.

Revenues Improve, Expenses Decline

Total revenues for the reported quarter were $320.6 million, up 1.4% year over year. Also, the figure beat the Zacks Consensus Estimate of $318.2 million.

For the year, total revenues of $1.27 billion improved 4.6% from the prior year.

Quarterly, net interest income on a tax-equivalent basis grew 2% year over year to $241.4 million. However, net interest margin (NIM), on a tax-equivalent basis, was 3.22%, contracting 21 basis points (bps) year over year.

Non-interest income was $82.4 million, down marginally from the year-ago level. The decline was primarily due to a fall in almost all fee income components except for secondary mortgage market operations.

Total non-interest expenses declined 2.4% year over year to $193.1 million mainly due to a fall in all cost components except for net occupancy and equipment costs.

As of Dec 31, 2020, total loans were $21.8 billion, down 2% from the prior quarter end. Total deposits increased 2.5% sequentially to $27.7 billion.

Credit Quality: Mixed Bag

Provision for credit losses jumped significantly from $9.2 million in the year-ago quarter to $24.2 million. Also, net charge-offs (NCOs) (annualized) were 0.44% of average total loans, up 26 bps from the year-ago quarter.

However, total non-performing assets declined 53.8% from the prior-year quarter end to $155.8 million.

Capital Ratios Mixed

As of Dec 31, 2020, Tier 1 leverage ratio was 7.87%, down from 8.76% at the end of the year-earlier quarter. Tier 1 risk-based capital ratio was 10.70%, up from 10.50% as of Dec 31, 2019.

First-Quarter 2021 Outlook

Management expects total loan balance to decline.

NIM is expected to be down 10 bps due to high levels of excess liquidity and net paycheck protection program (PPP) activity.

Our Take

Supported by a solid balance sheet position and inorganic expansion efforts, Hancock Whitney remains well-poised for the future. However, near-zero interest rates and economic slowdown remain major near-term concerns.

Hancock Whitney Corporation Price, Consensus and EPS Surprise


Hancock Whitney Corporation Price, Consensus and EPS Surprise

Hancock Whitney Corporation price-consensus-eps-surprise-chart | Hancock Whitney Corporation Quote

Currently, Hancock Whitney carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Banks

Washington Federal’s (WAFD - Free Report) first-quarter fiscal 2021 (ended Dec 31) earnings of 51 cents per share surpassed the Zacks Consensus Estimate of 42 cents. However, the figure reflects a year-over-year decline of 40.7%.

Bank of New York Mellon Corporation’s (BK - Free Report) fourth-quarter 2020 adjusted earnings per share of 96 cents were 5% lower than the prior-year quarter’s level. The Zacks Consensus Estimate for earnings was pegged at 93 cents.

Zions Bancorporation’s (ZION - Free Report) fourth-quarter 2020 net earnings per share of $1.66 surpassed the Zacks Consensus Estimate of $1.01. Moreover, the reported figure represents a rise of 71.1% from the year-ago quarter’s number.

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