United Community Banks (NYSE:UCB) Issues Quarterly Earnings Results, Misses Expectations By $0.09 EPS

United Community Banks (NYSE:UCB) posted its quarterly earnings results on Tuesday. The company reported $0.71 EPS for the quarter, missing analysts’ consensus estimates of $0.80 by ($0.09), Zacks reports. United Community Banks had a return on equity of 9.65% and a net margin of 22.05%.The business had revenue of $279.28 million during the quarter.

Here are the key takeaways from United Community Banks’ conference call:

• United Community Banks posted a solid quarter, with operating EPS of $0.71 up 8% year over year and total revenue up 7%. Management also highlighted a sixth straight quarter of net interest margin expansion to 3.68%.
• Loan growth accelerated to a 6.8% annualized pace, or 6.4% excluding Navitas, driven by stronger hiring of revenue producers. Executives said the new lending team additions are starting to show up in production and could support upper-single-digit growth next year.
• Credit quality remained strong, with bank-only net charge-offs of 9 basis points and total net charge-offs of 16 basis points. Past dues and criticized loan metrics were also described as being at very low levels.
• The quarter included a large non-operating benefit from releasing Navitas reserves as those loans were reclassified to held for sale, along with a one-time California lender license settlement cost tied to Navitas. Management said the Navitas sale is still expected to close early in the third quarter.
• Management reiterated a strong capital return and M&A optionality outlook, including buying back the remaining shares tied to Peach State and considering additional capital deployment next year. They also said small-bank acquisition conversations remain active and could increase after Peach State closes.

United Community Banks Trading Down 2.9%

Shares of NYSE UCB traded down $1.04 during trading hours on Tuesday, hitting $34.99. 85,119 shares of the company traded hands, compared to its average volume of 909,431. The stock has a market capitalization of $4.19 billion, a price-to-earnings ratio of 12.89 and a beta of 0.81. The company has a current ratio of 0.82, a quick ratio of 0.82 and a debt-to-equity ratio of 0.03. The company’s 50 day moving average price is $34.04 and its 200 day moving average price is $33.39. United Community Banks has a 12 month low of $28.65 and a 12 month high of $37.18.

United Community Banks Announces Dividend

The business also recently announced a quarterly dividend, which was paid on Friday, July 3rd. Stockholders of record on Monday, June 15th were issued a $0.25 dividend. The ex-dividend date was Monday, June 15th. This represents a $1.00 dividend on an annualized basis and a dividend yield of 2.9%. United Community Banks’s payout ratio is 36.76%.

Insider Buying and Selling

In other United Community Banks news, EVP Richard Bradshaw sold 1,510 shares of the business’s stock in a transaction on Monday, April 27th. The shares were sold at an average price of $33.09, for a total transaction of $49,965.90. Following the transaction, the executive vice president owned 84,497 shares in the company, valued at $2,796,005.73. The trade was a 1.76% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. 0.45% of the stock is owned by insiders.

Institutional Trading of United Community Banks

Institutional investors have recently added to or reduced their stakes in the company. Goldman Sachs Group Inc. grew its stake in United Community Banks by 70.6% in the fourth quarter. Goldman Sachs Group Inc. now owns 1,380,627 shares of the company’s stock worth $43,103,000 after purchasing an additional 571,296 shares in the last quarter. Wellington Management Group LLP raised its holdings in shares of United Community Banks by 125.7% in the third quarter. Wellington Management Group LLP now owns 774,660 shares of the company’s stock valued at $24,286,000 after acquiring an additional 431,491 shares in the last quarter. Qube Research & Technologies Ltd lifted its stake in United Community Banks by 105.9% in the third quarter. Qube Research & Technologies Ltd now owns 766,552 shares of the company’s stock worth $24,031,000 after acquiring an additional 394,263 shares during the period. Panagora Asset Management Inc. bought a new position in United Community Banks during the 4th quarter worth about $6,395,000. Finally, Hotchkis & Wiley Capital Management LLC purchased a new position in United Community Banks during the 3rd quarter valued at about $6,281,000. Institutional investors own 82.29% of the company’s stock.

Wall Street Analyst Weigh In

Several equities analysts have recently commented on UCB shares. DA Davidson boosted their target price on shares of United Community Banks from $39.00 to $40.00 and gave the stock a “buy” rating in a report on Monday, June 15th. Hovde Group reduced their price target on shares of United Community Banks from $38.00 to $37.00 and set a “market perform” rating on the stock in a report on Monday, April 27th. Stephens increased their price objective on shares of United Community Banks from $39.00 to $40.00 and gave the company an “overweight” rating in a report on Tuesday, April 28th. Keefe, Bruyette & Woods upgraded United Community Banks from a “market perform” rating to an “outperform” rating and raised their price objective for the company from $36.00 to $40.00 in a research report on Thursday, April 9th. Finally, Weiss Ratings raised United Community Banks from a “buy (b-)” rating to a “buy (b)” rating in a report on Tuesday, June 30th. One research analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating and three have issued a Hold rating to the company. Based on data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average target price of $38.40.

United Community Banks Company Profile

United Community Banks, Inc (NYSE: UCB) is a bank holding company headquartered in Blairsville, Georgia. It operates primarily through its subsidiary, United Community Bank, providing a broad range of banking and financial services to individual, business and governmental customers. The company’s core offerings include deposit accounts, commercial and consumer lending, mortgage origination, treasury and cash management services, and wealth management.

In addition to traditional banking products such as checking, savings and money market accounts, United Community Bank specializes in commercial real estate financing, small business administration (SBA) loans, equipment financing and agricultural lending.