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TFC vs. PNC: Which Regional Bank is Poised for More Growth?
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Key Takeaways
TFC sold insurance and asset-management units, shifting focus to capital markets and wealth management.
PNC is expanding its branch network and deal activity, including the 2025 Aqueduct Capital acquisition.
TFC resumed share buybacks with a $5B plan; PNC raised its dividend and continues large-scale repurchases.
Truist Financial Corporation (TFC - Free Report) and PNC Financial Services Group, Inc. (PNC - Free Report) are two U.S. regional banks that offer a variety of consumer and business banking services.
Formed in December 2019, following the “merger of equals” between BB&T Corp and SunTrust, TFC is one of the largest commercial banks in the United States. While Truist has been trying to enhance its non-interest revenue sources (following the divestiture of its insurance segment), PNC benefits from a well-diversified deposit base.
In the current high-interest rate environment, wherein economic growth has been sluggish because of the ongoing ambiguity surrounding the Trump-era tariffs, both TFC and PNC stocks have witnessed declines. In the past six months, TFC shares have lost 9.6%, while the PNC stock has declined 9.7%. The performance of both stocks has been worse than the Zacks Finance sector and the S&P 500 Index.
TFC vs. PNC Price Performance
Image Source: Zacks Investment Research
Hence, the question arises: Which regional bank — TFC or PNC — is a better pick for investors amid the challenging macroeconomic backdrop? Let us find out.
The Case for TFC Stock
Truist has been undertaking several business restructuring initiatives to enhance profitability. In 2024, the company divested its asset-management subsidiary, Sterling Capital Management LLC. Also, it completed the sale of its stake in the insurance subsidiary Truist Insurance Holdings. TFC acquired Service Finance Company, which augmented its point-of-sale lending business.
Since divesting its insurance subsidiary, TFC has been undertaking efforts to enhance its non-interest revenue sources. While the company’s total non-interest income declined in 2022 and 2024 due to huge securities losses, the metric (excluding securities losses) witnessed a five-year (2018-2023) compound annual growth rate (CAGR) of 1.7%. An enhanced focus on wealth management and capital markets businesses will likely offer support.
Moreover, the higher for longer interest rates are expected to support Truist’s net interest margin (NIM) and net interest income (NII) growth. In 2024, NIM expanded to 3.03% from the 2023 level of 2.98%. While NII declined in 2021 and 2024, the metric witnessed a five-year (ended 2024) CAGR of 14% on the back of decent loan demand, merger deals and high rates.
Supported by a strong capital position and earnings strength, TFC has been engaged in efficient capital distribution activities, through which, it has been enhancing shareholder value. After clearing the 2024 stress test, Truist maintained its quarterly dividend at 52 cents per share. Earlier, as the company was seeking to maintain higher capital levels, share repurchases were not a priority.
Nonetheless, the company has resumed buybacks, announcing a repurchase program worth $5 billion through 2026. Management expects to repurchase $750 million worth of shares in the second quarter of 2025.
The Case for PNC Stock
PNC Financial has been strengthening its business through partnerships and acquisitions. In May 2025, PNC’s subsidiary, PNC Bank, agreed to acquire Aqueduct Capital Group. In 2024, the bank partnered with Plaid through a bilateral data access agreement, allowing PNC customers to securely share their financial data with various financial applications. Also, PNC extended its partnership with TCW Group to offer private credit solutions to middle-market companies. Such efforts have helped diversify the company’s business mix, aiding its bottom line.
PNC Financial’s deposits and loans have witnessed a five-year (2019-2024) CAGR of 8.1% and 5.6%, respectively. Capitalizing on growth opportunities, in October 2023, the company acquired loan commitments from Signature Bank worth $16 billion. A well-diversified deposit base is expected to further strengthen its financial position.
Supported by decent loan demand and higher interest rates, over the five-year period ended 2024, PNC’s NII witnessed a CAGR of 6.3%. The company expects its NII to benefit from fixed asset repricing over the next couple of years.
Last year, PNC Financial announced plans to invest $1 billion to enhance its coast-to-coast branch network by opening more than 100 locations. It aims to renovate more than 1,200 existing branches to strengthen its presence in current markets. Over the next five years, PNC plans to increase its branch investment to $1.5 billion to open more than 200 new branches across 12 U.S. cities and renovate 1,400 existing locations.
Like TFC, PNC Financial has an efficient capital distribution plan in place. In July 2024, the company sequentially hiked quarterly cash dividends on common stock by 3.2% to $1.60 per share. Apart from regular dividend hikes, the company has a share repurchase program in place. In the second quarter of 2022, a 100-million share repurchase plan was authorized.
How Do Estimates Compare for TFC & PNC?
The Zacks Consensus Estimate for TFC’s 2025 and 2026 revenue implies year-over-year growth of 1.9% and 4.3%, respectively. Moreover, the consensus estimate for earnings indicates a 5.7% and 13% rise for 2025 and 2026, respectively. Earnings estimates for both years have been unchanged over the past week. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Image Source: Zacks Investment Research
On the contrary, analysts are more bullish on PNC Financial’s prospects. The consensus mark for PNC’s 2025 and 2026 sales suggests year-over-year increases of 5.8% and 5.5%, respectively. Also, the consensus estimate for earnings indicates a 9% and 12.2% rise for 2025 and 2026, respectively. Earnings estimates for both years have been revised upward over the past seven days.
Image Source: Zacks Investment Research
TFC & PNC: Valuation & Other Comparisons
Valuation-wise, TFC is currently trading at a price-to-book (P/B) of 0.87X, lower than its five-year median of 1.03X. The PNC stock, on the other hand, is currently trading at a P/B of 1.22X, which is also lower than its five-year median of 1.31X.
Image Source: Zacks Investment Research
Therefore, Truist is inexpensive compared with PNC Financial.
Meanwhile, TFC’s return on equity (ROE) of 8.96% is below PNC’s 10.95%. So, PNC Financial uses shareholder funds more efficiently to generate profits than Truist.
Image Source: Zacks Investment Research
Truist’s dividend yield of 5.34% is higher than PNC Financial’s 3.69%.
Image Source: Zacks Investment Research
TFC or PNC: Which Stock is a Better Bet for Long-Term Gains?
PNC Financial’s well-diversified deposit base, its investments in new branches to expand its footprint into key markets, and its improving NII (given the fixed asset repricing) will continue to support financials. The bank’s continued efforts to strengthen its business through partnerships will aid bottom-line growth. In addition to these, a robust ROE and accelerating earnings and sales growth estimates through 2026 suggest solid long-term upside potential.
Conversely, Truist, which is one of the largest commercial banks in the United States, has been well-positioned for top-line growth, supported by decent loan demand, relatively higher interest rates and its efforts to grow fee income. While the company’s business restructuring initiatives have been supporting profitability, its earnings outlook is not as impressive as PNC’s, with lesser growth expected in the next two years. Combined with a lower ROE and no change in earnings estimates in the past week, this suggests that while TFC is a well-run business, it may not match PNC’s upside potential in a growth-focused portfolio.
Thus, PNC Financial appears to be the better long-term investment for solid returns. While the PNC stock may seem pricey against TFC, its premium valuation is justifiable, considering higher growth expectations.
Image: Bigstock
TFC vs. PNC: Which Regional Bank is Poised for More Growth?
Key Takeaways
Truist Financial Corporation (TFC - Free Report) and PNC Financial Services Group, Inc. (PNC - Free Report) are two U.S. regional banks that offer a variety of consumer and business banking services.
Formed in December 2019, following the “merger of equals” between BB&T Corp and SunTrust, TFC is one of the largest commercial banks in the United States. While Truist has been trying to enhance its non-interest revenue sources (following the divestiture of its insurance segment), PNC benefits from a well-diversified deposit base.
In the current high-interest rate environment, wherein economic growth has been sluggish because of the ongoing ambiguity surrounding the Trump-era tariffs, both TFC and PNC stocks have witnessed declines. In the past six months, TFC shares have lost 9.6%, while the PNC stock has declined 9.7%. The performance of both stocks has been worse than the Zacks Finance sector and the S&P 500 Index.
TFC vs. PNC Price Performance
Image Source: Zacks Investment Research
Hence, the question arises: Which regional bank — TFC or PNC — is a better pick for investors amid the challenging macroeconomic backdrop? Let us find out.
The Case for TFC Stock
Truist has been undertaking several business restructuring initiatives to enhance profitability. In 2024, the company divested its asset-management subsidiary, Sterling Capital Management LLC. Also, it completed the sale of its stake in the insurance subsidiary Truist Insurance Holdings. TFC acquired Service Finance Company, which augmented its point-of-sale lending business.
Since divesting its insurance subsidiary, TFC has been undertaking efforts to enhance its non-interest revenue sources. While the company’s total non-interest income declined in 2022 and 2024 due to huge securities losses, the metric (excluding securities losses) witnessed a five-year (2018-2023) compound annual growth rate (CAGR) of 1.7%. An enhanced focus on wealth management and capital markets businesses will likely offer support.
Moreover, the higher for longer interest rates are expected to support Truist’s net interest margin (NIM) and net interest income (NII) growth. In 2024, NIM expanded to 3.03% from the 2023 level of 2.98%. While NII declined in 2021 and 2024, the metric witnessed a five-year (ended 2024) CAGR of 14% on the back of decent loan demand, merger deals and high rates.
Supported by a strong capital position and earnings strength, TFC has been engaged in efficient capital distribution activities, through which, it has been enhancing shareholder value. After clearing the 2024 stress test, Truist maintained its quarterly dividend at 52 cents per share. Earlier, as the company was seeking to maintain higher capital levels, share repurchases were not a priority.
Nonetheless, the company has resumed buybacks, announcing a repurchase program worth $5 billion through 2026. Management expects to repurchase $750 million worth of shares in the second quarter of 2025.
The Case for PNC Stock
PNC Financial has been strengthening its business through partnerships and acquisitions. In May 2025, PNC’s subsidiary, PNC Bank, agreed to acquire Aqueduct Capital Group. In 2024, the bank partnered with Plaid through a bilateral data access agreement, allowing PNC customers to securely share their financial data with various financial applications. Also, PNC extended its partnership with TCW Group to offer private credit solutions to middle-market companies. Such efforts have helped diversify the company’s business mix, aiding its bottom line.
PNC Financial’s deposits and loans have witnessed a five-year (2019-2024) CAGR of 8.1% and 5.6%, respectively. Capitalizing on growth opportunities, in October 2023, the company acquired loan commitments from Signature Bank worth $16 billion. A well-diversified deposit base is expected to further strengthen its financial position.
Supported by decent loan demand and higher interest rates, over the five-year period ended 2024, PNC’s NII witnessed a CAGR of 6.3%. The company expects its NII to benefit from fixed asset repricing over the next couple of years.
Last year, PNC Financial announced plans to invest $1 billion to enhance its coast-to-coast branch network by opening more than 100 locations. It aims to renovate more than 1,200 existing branches to strengthen its presence in current markets. Over the next five years, PNC plans to increase its branch investment to $1.5 billion to open more than 200 new branches across 12 U.S. cities and renovate 1,400 existing locations.
Like TFC, PNC Financial has an efficient capital distribution plan in place. In July 2024, the company sequentially hiked quarterly cash dividends on common stock by 3.2% to $1.60 per share. Apart from regular dividend hikes, the company has a share repurchase program in place. In the second quarter of 2022, a 100-million share repurchase plan was authorized.
How Do Estimates Compare for TFC & PNC?
The Zacks Consensus Estimate for TFC’s 2025 and 2026 revenue implies year-over-year growth of 1.9% and 4.3%, respectively. Moreover, the consensus estimate for earnings indicates a 5.7% and 13% rise for 2025 and 2026, respectively. Earnings estimates for both years have been unchanged over the past week. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Image Source: Zacks Investment Research
On the contrary, analysts are more bullish on PNC Financial’s prospects. The consensus mark for PNC’s 2025 and 2026 sales suggests year-over-year increases of 5.8% and 5.5%, respectively. Also, the consensus estimate for earnings indicates a 9% and 12.2% rise for 2025 and 2026, respectively. Earnings estimates for both years have been revised upward over the past seven days.
Image Source: Zacks Investment Research
TFC & PNC: Valuation & Other Comparisons
Valuation-wise, TFC is currently trading at a price-to-book (P/B) of 0.87X, lower than its five-year median of 1.03X. The PNC stock, on the other hand, is currently trading at a P/B of 1.22X, which is also lower than its five-year median of 1.31X.
Image Source: Zacks Investment Research
Therefore, Truist is inexpensive compared with PNC Financial.
Meanwhile, TFC’s return on equity (ROE) of 8.96% is below PNC’s 10.95%. So, PNC Financial uses shareholder funds more efficiently to generate profits than Truist.
Image Source: Zacks Investment Research
Truist’s dividend yield of 5.34% is higher than PNC Financial’s 3.69%.
Image Source: Zacks Investment Research
TFC or PNC: Which Stock is a Better Bet for Long-Term Gains?
PNC Financial’s well-diversified deposit base, its investments in new branches to expand its footprint into key markets, and its improving NII (given the fixed asset repricing) will continue to support financials. The bank’s continued efforts to strengthen its business through partnerships will aid bottom-line growth. In addition to these, a robust ROE and accelerating earnings and sales growth estimates through 2026 suggest solid long-term upside potential.
Conversely, Truist, which is one of the largest commercial banks in the United States, has been well-positioned for top-line growth, supported by decent loan demand, relatively higher interest rates and its efforts to grow fee income. While the company’s business restructuring initiatives have been supporting profitability, its earnings outlook is not as impressive as PNC’s, with lesser growth expected in the next two years. Combined with a lower ROE and no change in earnings estimates in the past week, this suggests that while TFC is a well-run business, it may not match PNC’s upside potential in a growth-focused portfolio.
Thus, PNC Financial appears to be the better long-term investment for solid returns. While the PNC stock may seem pricey against TFC, its premium valuation is justifiable, considering higher growth expectations.
At present, both Truist and PNC Financial carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.