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Regions Financial Surges 24% in 3 Months: Is There More Room to Run?
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Key Takeaways
Regions Financial shares surged 24.3% in three months, outpacing peers and the broader industry.
Strategic acquisitions, digital investments, and solid liquidity underpin RF's long-term outlook.
Dividend hikes and buybacks highlight RF's consistent shareholder returns.
Regions Financial Corporation’s (RF - Free Report) shares have appreciated 24.3% in the past three months compared with the industry’s growth of 12.9%. The stock also outperformed its peers, Popular, Inc. (BPOP - Free Report) and HomeTrust Bancshares (HTB - Free Report) which rallied 18.2% and 12.9% respectively, in the same frame.
Price Performance
Image Source: Zacks Investment Research
The company’s strategic acquisitions, digital investments, and strong liquidity position continue to support its financials in the long term.
Over the past month, the Zacks Consensus Estimate for earnings for 2025 has remained unchanged, while it has been revised marginally upward for 2026.
The anticipated estimates imply growth of 9.4% and 8.9% for 2025 and 2026, respectively.
Estimate Revision Trend
Image Source: Zacks Investment Research
Now let's discuss some key factors that could provide further impetus to RF stock.
Inorganic Expansion to Drive Growth: Over the last few years, Regions Financial has focused on expanding and diversifying its business operations through investments in varied product offerings and inorganic expansion efforts. In 2021, the company acquired Clearsight Advisors, EnerBank USA, and Sabal Capital Partners, broadening its revenue sources and strengthening its presence in specialized lending and wealth management.
Earlier, in 2019, it expanded its capabilities in the not-for-profit space, specifically in wealth management and the healthcare sector, through the acquisition of Highland Associates. RF continues to explore opportunities for bolt-on acquisitions and to add capabilities in its wealth management segment. These strategic initiatives are likely to diversify its revenue streams and support growth over the long term.
Fed’s Rate Cut Decision to Aid NII: At the 2025 Jackson Hole symposium, Fed Chair Jerome Powell signaled a potential rate cut at the upcoming September meeting, citing rising risks to the labor market. This development is positive for banks like Regions Financial, Popular, and HomeTrust, as it is likely to encourage lending activity.
The company’s NII has grown steadily, with a 10-year compound annual growth rate (CAGR) of 3.9% through 2024, and continued to rise in the first half of 2025. Fed rate cut in 2024 and expected rate cut this year will further drive NII. Management now anticipates NII to increase 3–5% in 2025.
NII Growth Trend
Image Source: Regions Financial Corporation
Steady Loan Balance: Regions Financial has experienced steady growth in its loan balances, with a five-year CAGR of 3.2% from 2019 to 2024. While total loans declined slightly in the first half of 2025, the rising loan pipelines and the company’s strong presence across strategic Southeastern and Midwest markets provide a solid foundation for future loan growth. Management expects average loan balances to remain stable to modestly higher in 2025, driven primarily by expansion in commercial and real estate lending.
Strong Liquidity to Aid Balance Sheet: The company continues to demonstrate financial resilience, supported by ample liquidity. As of June 30, 2025, Regions Financial reported liquidity sources totaling $65 billion, which is significantly higher than its total debt of $5.27 billion. Meanwhile, its investment-grade credit ratings of BBB+, Baa1, and A− from S&P, Moody’s, and Fitch, respectively, for its senior unsecured debt ensure access to capital at competitive rates and reflect low default risk. Thus, with a robust liquidity position, RF is well-positioned to meet its debt obligations and interest payments even in the event of future economic challenges.
Impressive Capital Distribution: RF’s focus on maintaining robust capital metrics supports its capital distribution activities. In July 2025, the bank increased its quarterly dividend by 6% to 26 cents per share. RF has increased its dividend five times in the last five years with an annualized dividend growth rate of 43%. Further, the company’s dividend yield stands at 3.65%. Notably, Popular has a yield of 2.23%. HomeTrust’s dividend yield is 1.16%.
Dividend Yield
Image Source: Zacks Investment Research
Also, the company has a share repurchase plan in place, which was announced in April 2022, authorizing it to repurchase up to $2.5 billion through the fourth quarter of 2025. As of June 30, 2025, $1.5 billion remained available under authorization. With strong liquidity and solid capital, the company continues to ensure sustainable returns for its shareholders, even amid market volatility.
Digital Investments to Enhance Operations: Regions Financial is advancing its growth strategy through continued investments in digital platforms and talent. Following the 2023 launch of BillerXchange and Expresso by Regions Bank, adoption of its enhanced mobile and online services has increased significantly. In the first half of 2025, digital sales across lending and deposit products showed strong growth. Looking ahead, the company plans to upgrade its commercial loan system and pilot a new cloud-based deposit system in late 2026, with full deployment expected in 2027. These efforts are expected to improve operational efficiency and contribute to sustainable revenue growth.
Few Concerns Prevail for RF
Mounting Expenses: Regions Financial has continued to experience rising expenses. Non-interest expenses grew at a CAGR of 4% between 2019 and 2024. Although these expenses declined in the first half of 2025, compensation and other operating costs continue to increase.
Expense Trend
Image Source: Zacks Investment Research
Management expects adjusted non-interest expenses to rise 1–2% in 2025, and elevated operating costs may pressure margins in the near term.
Loan Concentration Risk: As of June 2025, 66% of RF’s loan portfolio was concentrated in commercial lending, including commercial real estate. With rising non-accruals in sectors such as office, healthcare, and transportation, asset quality remains a concern amid macroeconomic uncertainty. Meanwhile, non-performing loans comprised 56.3% of RF’s total non-performing assets as of June 30, 2025. Therefore, the lack of diversification in the loan portfolio poses a risk to the company’s financial performance if adverse economic conditions persist.
Final Thoughts on RF Stock
Regions Financial continues to face near-term headwinds from rising expenses and concentrated loan exposure, which could pressure margins and asset quality.
RF shares are trading at a forward price-to-earnings (P/E) ratio of 11.12X, slightly below the industry average.
Price-to-Earnings F12 M
Image Source: Zacks Investment Research
On the other hand, Popular and HomeTrust are trading at 10.22X and 11.77X, respectively.
Nevertheless, RF is likely to benefit from steady NII growth, strong liquidity, and consistent capital returns. Strategic acquisitions and ongoing digital investments further strengthen its position for long-term performance. Investors can consider RF stock given its solid upside potential amid these growth initiatives and favorable macroeconomic developments.
Image: Bigstock
Regions Financial Surges 24% in 3 Months: Is There More Room to Run?
Key Takeaways
Regions Financial Corporation’s (RF - Free Report) shares have appreciated 24.3% in the past three months compared with the industry’s growth of 12.9%. The stock also outperformed its peers, Popular, Inc. (BPOP - Free Report) and HomeTrust Bancshares (HTB - Free Report) which rallied 18.2% and 12.9% respectively, in the same frame.
Price Performance
Image Source: Zacks Investment Research
The company’s strategic acquisitions, digital investments, and strong liquidity position continue to support its financials in the long term.
Over the past month, the Zacks Consensus Estimate for earnings for 2025 has remained unchanged, while it has been revised marginally upward for 2026.
The anticipated estimates imply growth of 9.4% and 8.9% for 2025 and 2026, respectively.
Estimate Revision Trend
Image Source: Zacks Investment Research
Now let's discuss some key factors that could provide further impetus to RF stock.
Inorganic Expansion to Drive Growth: Over the last few years, Regions Financial has focused on expanding and diversifying its business operations through investments in varied product offerings and inorganic expansion efforts. In 2021, the company acquired Clearsight Advisors, EnerBank USA, and Sabal Capital Partners, broadening its revenue sources and strengthening its presence in specialized lending and wealth management.
Earlier, in 2019, it expanded its capabilities in the not-for-profit space, specifically in wealth management and the healthcare sector, through the acquisition of Highland Associates. RF continues to explore opportunities for bolt-on acquisitions and to add capabilities in its wealth management segment. These strategic initiatives are likely to diversify its revenue streams and support growth over the long term.
Fed’s Rate Cut Decision to Aid NII: At the 2025 Jackson Hole symposium, Fed Chair Jerome Powell signaled a potential rate cut at the upcoming September meeting, citing rising risks to the labor market. This development is positive for banks like Regions Financial, Popular, and HomeTrust, as it is likely to encourage lending activity.
The company’s NII has grown steadily, with a 10-year compound annual growth rate (CAGR) of 3.9% through 2024, and continued to rise in the first half of 2025. Fed rate cut in 2024 and expected rate cut this year will further drive NII. Management now anticipates NII to increase 3–5% in 2025.
NII Growth Trend
Image Source: Regions Financial Corporation
Steady Loan Balance: Regions Financial has experienced steady growth in its loan balances, with a five-year CAGR of 3.2% from 2019 to 2024. While total loans declined slightly in the first half of 2025, the rising loan pipelines and the company’s strong presence across strategic Southeastern and Midwest markets provide a solid foundation for future loan growth. Management expects average loan balances to remain stable to modestly higher in 2025, driven primarily by expansion in commercial and real estate lending.
Strong Liquidity to Aid Balance Sheet: The company continues to demonstrate financial resilience, supported by ample liquidity. As of June 30, 2025, Regions Financial reported liquidity sources totaling $65 billion, which is significantly higher than its total debt of $5.27 billion. Meanwhile, its investment-grade credit ratings of BBB+, Baa1, and A− from S&P, Moody’s, and Fitch, respectively, for its senior unsecured debt ensure access to capital at competitive rates and reflect low default risk. Thus, with a robust liquidity position, RF is well-positioned to meet its debt obligations and interest payments even in the event of future economic challenges.
Impressive Capital Distribution: RF’s focus on maintaining robust capital metrics supports its capital distribution activities. In July 2025, the bank increased its quarterly dividend by 6% to 26 cents per share. RF has increased its dividend five times in the last five years with an annualized dividend growth rate of 43%. Further, the company’s dividend yield stands at 3.65%. Notably, Popular has a yield of 2.23%. HomeTrust’s dividend yield is 1.16%.
Dividend Yield
Image Source: Zacks Investment Research
Also, the company has a share repurchase plan in place, which was announced in April 2022, authorizing it to repurchase up to $2.5 billion through the fourth quarter of 2025. As of June 30, 2025, $1.5 billion remained available under authorization. With strong liquidity and solid capital, the company continues to ensure sustainable returns for its shareholders, even amid market volatility.
Digital Investments to Enhance Operations: Regions Financial is advancing its growth strategy through continued investments in digital platforms and talent. Following the 2023 launch of BillerXchange and Expresso by Regions Bank, adoption of its enhanced mobile and online services has increased significantly. In the first half of 2025, digital sales across lending and deposit products showed strong growth. Looking ahead, the company plans to upgrade its commercial loan system and pilot a new cloud-based deposit system in late 2026, with full deployment expected in 2027. These efforts are expected to improve operational efficiency and contribute to sustainable revenue growth.
Few Concerns Prevail for RF
Mounting Expenses: Regions Financial has continued to experience rising expenses. Non-interest expenses grew at a CAGR of 4% between 2019 and 2024. Although these expenses declined in the first half of 2025, compensation and other operating costs continue to increase.
Expense Trend
Image Source: Zacks Investment Research
Management expects adjusted non-interest expenses to rise 1–2% in 2025, and elevated operating costs may pressure margins in the near term.
Loan Concentration Risk: As of June 2025, 66% of RF’s loan portfolio was concentrated in commercial lending, including commercial real estate. With rising non-accruals in sectors such as office, healthcare, and transportation, asset quality remains a concern amid macroeconomic uncertainty. Meanwhile, non-performing loans comprised 56.3% of RF’s total non-performing assets as of June 30, 2025. Therefore, the lack of diversification in the loan portfolio poses a risk to the company’s financial performance if adverse economic conditions persist.
Final Thoughts on RF Stock
Regions Financial continues to face near-term headwinds from rising expenses and concentrated loan exposure, which could pressure margins and asset quality.
RF shares are trading at a forward price-to-earnings (P/E) ratio of 11.12X, slightly below the industry average.
Price-to-Earnings F12 M
Image Source: Zacks Investment Research
On the other hand, Popular and HomeTrust are trading at 10.22X and 11.77X, respectively.
Nevertheless, RF is likely to benefit from steady NII growth, strong liquidity, and consistent capital returns. Strategic acquisitions and ongoing digital investments further strengthen its position for long-term performance. Investors can consider RF stock given its solid upside potential amid these growth initiatives and favorable macroeconomic developments.
Regions Financial currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.