We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Sallie Mae Q1 Earnings Beat on Y/Y Rise in NII, Fee Income Declines
Read MoreHide Full Article
Key Takeaways
SLM Q1 EPS of $1.54 beat estimates and rose 10% y/y.
Sallie Mae benefited from lower credit provisions and higher NII despite lower fee income.
SLM raised the 2026 EPS outlook to $3.10-$3.20 on loan growth and planned share repurchases.
SLM Corporation (SLM - Free Report) reported first-quarter 2026 earnings per share (EPS) of $1.54, beating the Zacks Consensus Estimate of $1.14. The metric rose 10% from the year-ago quarter.
The quarterly results benefited from a rise in net interest income (NII), lower provisions for credit losses, and disciplined decisions across funding, expenses and capital management, partially offset by a decline in non-interest income and an increase in expenses.
The company’s GAAP net income attributable to common stock was $304 million compared with $301 million in the year-ago quarter.
Sallie Mae’s NII & Expenses Rise
First-quarter NII totaled $375.4 million, up from $374.9 million in the prior-year quarter. The metric beat the Zacks Consensus Estimate by 2.4%.
The quarterly net interest margin was 5.29%, expanding 2 basis points year over year.
Quarterly non-interest income was $185 million, down from $206 million in the year-ago quarter.
Non-interest expenses increased 10.7% year over year to $171 million. Compensation and benefits expenses rose 13.9% year over year to $103 million. Other operating expenses were $62 million, up 24.1% year over year.
SLM’s Credit Quality Mixed
In the first quarter, the company reported provision benefits of $11 million, in contrast to provisions for credit losses of $23 million in the prior-year quarter.
Net charge-offs were $89 million in the reported quarter.
Delinquencies as a percentage of loans in repayment were 3.98% for the first quarter of 2026 compared with 3.58% in the prior-year quarter.
Loans in a hardship forbearance were 0.99% for the reported quarter compared with 0.92% in the year-ago quarter.
Sallie Mae’s Balance Sheet Position
As of March 31, 2026, deposits totaled $20.5 billion, up from $20.1 billion in the year-ago quarter.
Private education loans held for investment, net, were $19.9 billion, down from $21.1 billion in the prior-year quarter.
Average loans outstanding, net, totaled $23.3 billion in the quarter. In the reported quarter, private education loan originations increased 5% year over year.
Key Ratios of SLM
The efficiency ratio was 30.6% compared with 26.6% in the year-ago quarter.
Return on assets was 4.2%, stable with the prior-year quarter.
Return on common equity was 56.4% compared with 60.1% in the year-ago quarter.
Sallie Mae Lifts 2026 Outlook as Growth Initiatives Expand
Management raised the 2026 EPS guidance to $3.10-$3.20 (previous guidance was $2.70-$2.80). The updated view assumes full utilization of the $500-million share repurchase authorization in 2026 and roughly $1 billion of incremental loan sales beyond the initial plan.
Other elements of the company’s 2026 outlook were reaffirmed. Sallie Mae continues to expect year-over-year private education loan origination growth of 12-14%, net charge-offs of $345-$385 million and non-interest expenses of $750-$780 million. Executives also reiterated that the firm is preparing for expected multi-year growth tied to federal reforms affecting graduate lending, while continuing to build partnership capacity to support future flow sales.
Final Thoughts on SLM
Sallie Mae delivered a decent first-quarter performance, supported by stable NII, lower provisions for credit losses and strong loan sales. Growth in private education loan originations and continued capital deployment remain positives. However, higher expenses, a decline in non-interest income and elevated delinquency levels warrant close monitoring going forward.
Performance & Earnings Expectations of SLM’s Peers
Ally Financial’s (ALLY - Free Report) first-quarter 2026 adjusted earnings of $1.11 per share surpassed the Zacks Consensus Estimate of 93 cents. The bottom line reflected a 90% jump from the year-ago quarter.
Results primarily benefited from a rise in net financing revenues and a sharp increase in other revenues. Lower expenses and an increase in loan and deposit balances were tailwinds for ALLY. However, a rise in provisions was an undermining factor.
Navient (NAVI - Free Report) is scheduled to announce first-quarter 2026 results on April 29.
Over the past seven days, the Zacks Consensus Estimate for NAVI’s quarterly earnings has been unchanged at 17 cents. This implies a 39.3% decline from the prior-year quarter’s actual.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Sallie Mae Q1 Earnings Beat on Y/Y Rise in NII, Fee Income Declines
Key Takeaways
SLM Corporation (SLM - Free Report) reported first-quarter 2026 earnings per share (EPS) of $1.54, beating the Zacks Consensus Estimate of $1.14. The metric rose 10% from the year-ago quarter.
The quarterly results benefited from a rise in net interest income (NII), lower provisions for credit losses, and disciplined decisions across funding, expenses and capital management, partially offset by a decline in non-interest income and an increase in expenses.
The company’s GAAP net income attributable to common stock was $304 million compared with $301 million in the year-ago quarter.
Sallie Mae’s NII & Expenses Rise
First-quarter NII totaled $375.4 million, up from $374.9 million in the prior-year quarter. The metric beat the Zacks Consensus Estimate by 2.4%.
The quarterly net interest margin was 5.29%, expanding 2 basis points year over year.
Quarterly non-interest income was $185 million, down from $206 million in the year-ago quarter.
Non-interest expenses increased 10.7% year over year to $171 million. Compensation and benefits expenses rose 13.9% year over year to $103 million. Other operating expenses were $62 million, up 24.1% year over year.
SLM’s Credit Quality Mixed
In the first quarter, the company reported provision benefits of $11 million, in contrast to provisions for credit losses of $23 million in the prior-year quarter.
Net charge-offs were $89 million in the reported quarter.
Delinquencies as a percentage of loans in repayment were 3.98% for the first quarter of 2026 compared with 3.58% in the prior-year quarter.
Loans in a hardship forbearance were 0.99% for the reported quarter compared with 0.92% in the year-ago quarter.
Sallie Mae’s Balance Sheet Position
As of March 31, 2026, deposits totaled $20.5 billion, up from $20.1 billion in the year-ago quarter.
Private education loans held for investment, net, were $19.9 billion, down from $21.1 billion in the prior-year quarter.
Average loans outstanding, net, totaled $23.3 billion in the quarter. In the reported quarter, private education loan originations increased 5% year over year.
Key Ratios of SLM
The efficiency ratio was 30.6% compared with 26.6% in the year-ago quarter.
Return on assets was 4.2%, stable with the prior-year quarter.
Return on common equity was 56.4% compared with 60.1% in the year-ago quarter.
Sallie Mae Lifts 2026 Outlook as Growth Initiatives Expand
Management raised the 2026 EPS guidance to $3.10-$3.20 (previous guidance was $2.70-$2.80). The updated view assumes full utilization of the $500-million share repurchase authorization in 2026 and roughly $1 billion of incremental loan sales beyond the initial plan.
Other elements of the company’s 2026 outlook were reaffirmed. Sallie Mae continues to expect year-over-year private education loan origination growth of 12-14%, net charge-offs of $345-$385 million and non-interest expenses of $750-$780 million. Executives also reiterated that the firm is preparing for expected multi-year growth tied to federal reforms affecting graduate lending, while continuing to build partnership capacity to support future flow sales.
Final Thoughts on SLM
Sallie Mae delivered a decent first-quarter performance, supported by stable NII, lower provisions for credit losses and strong loan sales. Growth in private education loan originations and continued capital deployment remain positives. However, higher expenses, a decline in non-interest income and elevated delinquency levels warrant close monitoring going forward.
SLM Corporation Price, Consensus and EPS Surprise
SLM Corporation price-consensus-eps-surprise-chart | SLM Corporation Quote
Currently, SLM carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Expectations of SLM’s Peers
Ally Financial’s (ALLY - Free Report) first-quarter 2026 adjusted earnings of $1.11 per share surpassed the Zacks Consensus Estimate of 93 cents. The bottom line reflected a 90% jump from the year-ago quarter.
Results primarily benefited from a rise in net financing revenues and a sharp increase in other revenues. Lower expenses and an increase in loan and deposit balances were tailwinds for ALLY. However, a rise in provisions was an undermining factor.
Navient (NAVI - Free Report) is scheduled to announce first-quarter 2026 results on April 29.
Over the past seven days, the Zacks Consensus Estimate for NAVI’s quarterly earnings has been unchanged at 17 cents. This implies a 39.3% decline from the prior-year quarter’s actual.