A month has gone by since the last earnings report for UMB Financial (UMBF Quick QuoteUMBF - Free Report) . Shares have added about 1.2% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is UMB due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

UMB Financial Q1 Earnings & Revenues Top Estimates

UMB Financial’s first-quarter 2024 operating earnings per share (EPS) of $2.47 beat the Zacks Consensus Estimate of $1.85. Also, the bottom line compared favorably with the $1.91 earned in the year-ago quarter.

Results benefited from higher non-interest income, strong loan and deposit balances and lower provisions. Nonetheless, a decline in NII, lower net interest margin (NIM) and increased expenses were undermining factors.

The results included the charge of $13 million related to the FDIC special assessment. After considering these charges, the net income for UMBF was $110.3 million for the specified quarter, up 19.3% year over year.

Quarterly Revenues Increase, Costs Rise

Quarterly revenues were $398.7 million, up 7.2% year over year. Also, the top line beat the Zacks Consensus Estimate of $369.8 million.

NII on an FTE basis was $246 million, which declined nearly 1% from the prior-year quarter. On an FTE basis, NIM was 2.48%, down 28 basis points.

Non-interest income was $159.2 million, up 22.3% year over year. The rise was primarily driven by an increase in trust and securities processing, insurance fees and commissions, bankcard fees and investment securities gain.

Non-interest expenses were $254.8 million, up 7.5% year over year. The rise was driven by higher regulatory fees, mainly from the FDIC special assessment. Also, a rise in processing fees and an uptick in bankcard expenses were some of the other major reasons behind the improvement. These were partially offset by a decline in operational losses and equipment costs. The operating non-interest expense was $241.2 million.

The efficiency ratio increased to 63.44%, up from the prior-year quarter’s 63.12%. An increase in efficiency ratio indicates a decrease in profitability.

As of Mar 31, 2024, average loans and leases were $23.4 billion, up 1.1% sequentially. Also, average deposits increased 2.6% to $33.5 billion.

Credit Quality Improves

The ratio of net charge-offs to average loans was 0.05% in the reported quarter, which decreased from 0.09% in the year-ago quarter.

Also, total non-accrual and restructured loans were $17.8 million, up 14.7% year over year.

The provision for credit losses was $10 million for the first quarter of 2024, down 57% from the prior-year quarter. This reduction was primarily due to the favorable changes in macroeconomic factors and credit metrics.

Capital Ratios Improve

As of Mar 31, 2024, the Tier 1 risk-based capital ratio was 11.09%, which rose from 10.57% as of Mar 31, 2023. The Tier 1 leverage ratio was 8.39%, which increased from 8.35% as of Mar 31, 2023. The total risk-based capital ratio was 13.03%, which grew from 12.49% in the year-ago quarter.

Profitability Ratios Improve

Return on average assets at the quarter’s end was 1.06%, which increased from the year-ago quarter’s 0.97%. Further, the operating return on average equity was 14.11%, up from 13.76% reported in the previous year’s quarter.

Capital Distribution Activities

In the first quarter of 2024, the board of directors approved a new share repurchase plan of up to one million shares of the company's common stock.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates.

The consensus estimate has shifted 6.7% due to these changes.

VGM Scores

At this time, UMB has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise UMB has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry Player

UMB belongs to the Zacks Banks - Midwest industry. Another stock from the same industry, Huntington Bancshares (HBAN Quick QuoteHBAN - Free Report) , has gained 1.4% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.

Huntington Bancshares reported revenues of $1.77 billion in the last reported quarter, representing a year-over-year change of -8.5%. EPS of $0.28 for the same period compares with $0.38 a year ago.

Huntington Bancshares is expected to post earnings of $0.29 per share for the current quarter, representing a year-over-year change of -17.1%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Huntington Bancshares. Also, the stock has a VGM Score of D.