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Navient Stock Up on Q2 Earnings Beat, Expenses & Provisions Fall Y/Y
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Key Takeaways
NAVI's Q2 EPS of 29 cents beats estimates, while shares gained 4.8% in yesterday's trading.
Expenses fall 15.8% y/y, and provisions decline, while NII drops 8.3% to $120 million.
Consumer Lending net income rises 3.8% y/y, while Federal Education Loans income declines 13.3%.
Shares of Navient Corporation (NAVI - Free Report) gained 4.8% in yesterday’s trading session after reporting better-than-expected results. The company’s second-quarter 2026 earnings per share (EPS) of 29 cents surpassed the Zacks Consensus Estimate of 19 cents. It reported earnings of 21 cents in the prior-year quarter.
Results benefited from lower expenses and a decline in provisions for loan losses. However, a decrease in net interest income (NII) and other income acted as a headwind.
Navient’s GAAP net income was $25 million compared with $14 million in the prior-year quarter.
Navient’s NII & Expenses Decline
NII declined 8.3% year over year to $120 million in the second quarter. It missed the Zacks Consensus Estimate of $129.1 million by 7%.
Total other income decreased 18.2% year over year to $27 million.
Provision for loan losses was $26 million, down from $37 million in the prior-year quarter.
Total expenses decreased 15.8% year over year to $85 million.
NAVI’s Quarterly Performance of Segments
Federal Education Loans: The segment generated a net income of $26 million, which declined 13.3% year over year.
As of June 30, 2026, the company’s net FFELP loans were $26.6 billion, down 10.3% sequentially.
Consumer Lending: This segment reported a net income of $27 million, which increased 3.8% from the year-ago quarter.
The private education loan delinquency rate greater than 30 days was 5.4% compared with 6.4% in the prior-year quarter.
As of June 30, 2026, the company’s private education loans were $15.7 billion, which increased marginally from the prior quarter. Navient originated $735 million of private education refinance loans in the reported quarter.
Navient’s Liquidity
To meet liquidity needs, NAVI expects to utilize various sources, including cash on hand, unencumbered education loan portfolios, operating cash flows, repayments of principal on unencumbered education loan assets and distributions from securitization trusts. It may also draw down on the secured FFELP Loan and Private Education Loan facilities, issue term asset-backed securities (ABS), enter additional Private Education Loan and ABS repurchase facilities, or issue additional unsecured debt.
Notably, the company had $770 million of cash and cash equivalents as of June 30, 2026.
Navient’s Capital Distribution Activities
In the second quarter, the company paid $15 million in common stock dividends.
In the reported quarter, Navient repurchased shares of common stock for $2 million.
Our Take on NAVI
Navient’s second-quarter results benefited from lower expenses and a decline in provisions for loan losses. The year-over-year improvement in Consumer Lending net income and solid private education refinance loan originations were other positives.
However, lower NII and other income remained concerns. The continued decline in the FFELP loan portfolio is also likely to weigh on interest income, while the company’s disciplined expense management should provide some support to financial performance.
Navient Corporation Price, Consensus and EPS Surprise
Capital One Financial’s (COF - Free Report) second-quarter 2026 adjusted earnings of $5.81 per share significantly outpaced the Zacks Consensus Estimate of $4.85. The bottom line was up from $5.48 in the prior-year quarter.
Results benefited from a rise in net interest income and non-interest income, along with a substantial decline in provisions. Loan growth and improvement in net interest margin were other positives. However, higher expenses and a sequential decline in deposits were undermining factors for COF.
Enova International, Inc. (ENVA - Free Report) reported second-quarter 2026 adjusted earnings per share of $4.31, which increased from $3.23 in the prior-year quarter. The metric surpassed the Zacks Consensus Estimate of $3.99.
ENVA’s results were aided by increased revenues and improving credit quality. However, an increase in expenses was a headwind.
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Navient Stock Up on Q2 Earnings Beat, Expenses & Provisions Fall Y/Y
Key Takeaways
Shares of Navient Corporation (NAVI - Free Report) gained 4.8% in yesterday’s trading session after reporting better-than-expected results. The company’s second-quarter 2026 earnings per share (EPS) of 29 cents surpassed the Zacks Consensus Estimate of 19 cents. It reported earnings of 21 cents in the prior-year quarter.
Results benefited from lower expenses and a decline in provisions for loan losses. However, a decrease in net interest income (NII) and other income acted as a headwind.
Navient’s GAAP net income was $25 million compared with $14 million in the prior-year quarter.
Navient’s NII & Expenses Decline
NII declined 8.3% year over year to $120 million in the second quarter. It missed the Zacks Consensus Estimate of $129.1 million by 7%.
Total other income decreased 18.2% year over year to $27 million.
Provision for loan losses was $26 million, down from $37 million in the prior-year quarter.
Total expenses decreased 15.8% year over year to $85 million.
NAVI’s Quarterly Performance of Segments
Federal Education Loans: The segment generated a net income of $26 million, which declined 13.3% year over year.
As of June 30, 2026, the company’s net FFELP loans were $26.6 billion, down 10.3% sequentially.
Consumer Lending: This segment reported a net income of $27 million, which increased 3.8% from the year-ago quarter.
The private education loan delinquency rate greater than 30 days was 5.4% compared with 6.4% in the prior-year quarter.
As of June 30, 2026, the company’s private education loans were $15.7 billion, which increased marginally from the prior quarter. Navient originated $735 million of private education refinance loans in the reported quarter.
Navient’s Liquidity
To meet liquidity needs, NAVI expects to utilize various sources, including cash on hand, unencumbered education loan portfolios, operating cash flows, repayments of principal on unencumbered education loan assets and distributions from securitization trusts. It may also draw down on the secured FFELP Loan and Private Education Loan facilities, issue term asset-backed securities (ABS), enter additional Private Education Loan and ABS repurchase facilities, or issue additional unsecured debt.
Notably, the company had $770 million of cash and cash equivalents as of June 30, 2026.
Navient’s Capital Distribution Activities
In the second quarter, the company paid $15 million in common stock dividends.
In the reported quarter, Navient repurchased shares of common stock for $2 million.
Our Take on NAVI
Navient’s second-quarter results benefited from lower expenses and a decline in provisions for loan losses. The year-over-year improvement in Consumer Lending net income and solid private education refinance loan originations were other positives.
However, lower NII and other income remained concerns. The continued decline in the FFELP loan portfolio is also likely to weigh on interest income, while the company’s disciplined expense management should provide some support to financial performance.
Navient Corporation Price, Consensus and EPS Surprise
Navient Corporation price-consensus-eps-surprise-chart | Navient Corporation Quote
Currently, NAVI carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Navient’s Peers
Capital One Financial’s (COF - Free Report) second-quarter 2026 adjusted earnings of $5.81 per share significantly outpaced the Zacks Consensus Estimate of $4.85. The bottom line was up from $5.48 in the prior-year quarter.
Results benefited from a rise in net interest income and non-interest income, along with a substantial decline in provisions. Loan growth and improvement in net interest margin were other positives. However, higher expenses and a sequential decline in deposits were undermining factors for COF.
Enova International, Inc. (ENVA - Free Report) reported second-quarter 2026 adjusted earnings per share of $4.31, which increased from $3.23 in the prior-year quarter. The metric surpassed the Zacks Consensus Estimate of $3.99.
ENVA’s results were aided by increased revenues and improving credit quality. However, an increase in expenses was a headwind.