Columbia Banking System (NASDAQ:COLB) Issues Earnings Results

Columbia Banking System (NASDAQ:COLB) issued its quarterly earnings results on Thursday. The financial services provider reported $0.82 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.77 by $0.05, FiscalAI reports. Columbia Banking System had a return on equity of 11.69% and a net margin of 22.83%. The firm had revenue of $702.00 million during the quarter, compared to analyst estimates of $687.74 million. During the same period last year, the company posted $0.85 EPS. The firm’s quarterly revenue was up 19.4% on a year-over-year basis.

Here are the key takeaways from Columbia Banking System’s conference call:

• Third-quarter operating EPS was $0.82, while operating pre-provision net revenue and operating net income rose 7% and 6% sequentially, respectively. Management reported a 1.4% ROAA and more than 17% ROTCE.
• Net interest margin expanded to 4.11%, driven by balance-sheet optimization, stronger relationship-commercial lending and a $1.5 billion reduction in wholesale funding. Management expects NIM to remain above 4% in the fourth quarter and continue in the low-4% range thereafter.
• Customer deposits increased nearly $1.2 billion during the quarter, helping lift total deposits to $52.7 billion while the cost of interest-bearing deposits declined slightly. Fee businesses also showed momentum, including treasury management, international banking and commercial card services.
• The board authorized a new $1.2 billion share-repurchase program after the prior program reduced the common share count by 8%; management expects to repurchase $150 million to $200 million of shares in the fourth quarter.
• Loans declined to $46.9 billion as the company avoided aggressively priced or highly leveraged CRE opportunities, and management expects balances to remain flat to slightly lower over the next several quarters. Provision expense was $33 million, reflecting portfolio runoff, credit migration and a less favorable rate outlook, although executives characterized credit metrics as stable.

Columbia Banking System Stock Up 3.2%

COLB stock traded up $0.96 during midday trading on Friday, reaching $30.85. The company’s stock had a trading volume of 5,566,068 shares, compared to its average volume of 2,626,292. The business’s 50-day simple moving average is $29.68 and its 200-day simple moving average is $30.24. Columbia Banking System has a 52 week low of $25.12 and a 52 week high of $33.67. The stock has a market cap of $8.73 billion, a PE ratio of 10.67, a price-to-earnings-growth ratio of 0.87 and a beta of 0.66.

Columbia Banking System Dividend Announcement

The firm also recently announced a quarterly dividend, which was paid on Monday, September 14th. Stockholders of record on Friday, August 28th were paid a $0.37 dividend. This represents a $1.48 annualized dividend and a dividend yield of 4.8%. The ex-dividend date of this dividend was Friday, August 28th. Columbia Banking System’s dividend payout ratio (DPR) is 58.96%.

More Columbia Banking System News

Here are the key news stories impacting Columbia Banking System this week:

• Positive Sentiment: Q3 earnings and revenue exceeded expectations. Columbia reported adjusted earnings of $0.82 per share versus the $0.77 consensus estimate, while revenue reached $702 million, above the $687.7 million forecast. Revenue increased 19.4% year over year. Columbia Banking Q3 earnings report
• Positive Sentiment: Profitability improved materially. Net income rose to $220 million, or $0.78 per diluted share, from $96 million a year earlier. Net interest income increased $26 million sequentially to $615 million, and net interest margin expanded 18 basis points to 4.11%. Deposits also grew to $52.74 billion from $52.06 billion in the prior quarter. Columbia Banking Q3 net income report
• Positive Sentiment: Capital returns are a major catalyst. The bank repurchased $199 million of common stock during the quarter, completed its previous authorization and approved a new buyback of up to $1.2 billion with no expiration date. Columbia also maintained its quarterly dividend at $0.37 per share. Columbia Banking System third-quarter results
• Positive Sentiment: RBC raised its price target to $34 from $32. Although the firm retained a “sector perform” rating, the higher target implies additional upside from the current trading level. Royal Bank of Canada analyst recommendation
• Neutral Sentiment: Columbia reported third-quarter net charge-offs, but the available announcement does not provide enough detail to determine whether credit quality improved or deteriorated. Columbia Banking net charge-offs report
• Negative Sentiment: Adjusted earnings of $0.82 per share declined from $0.85 in the year-earlier quarter, meaning the results were strong relative to estimates but not across every year-over-year earnings measure.

Wall Street Analyst Weigh In

A number of research analysts recently issued reports on the company. Citigroup lowered their target price on Columbia Banking System from $32.00 to $31.00 and set a “neutral” rating on the stock in a report on Tuesday, September 22nd. Keefe, Bruyette & Woods boosted their price target on shares of Columbia Banking System from $34.00 to $35.00 and gave the company an “outperform” rating in a report on Friday, July 24th. Zacks Research raised Columbia Banking System from a “strong sell” rating to a “hold” rating in a research note on Monday, August 31st. JPMorgan Chase & Co. reduced their price target on Columbia Banking System from $35.00 to $33.00 and set a “neutral” rating for the company in a report on Thursday, October 1st. Finally, Stephens lifted their price target on Columbia Banking System from $35.00 to $36.00 and gave the stock an “overweight” rating in a research report on Friday, July 24th. Five investment analysts have rated the stock with a Buy rating and nine have assigned a Hold rating to the company’s stock. According to data from MarketBeat.com, the company has a consensus rating of “Hold” and a consensus target price of $33.38.

About Columbia Banking System

Columbia Banking System, Inc is a bank holding company headquartered in Tacoma, Washington. It operates through Umpqua Bank, a full-service financial institution serving consumers, businesses, professionals and institutions.

Umpqua Bank provides deposit accounts, residential and commercial lending, business banking, treasury and cash-management services, mortgage banking, personal banking and wealth-management solutions. Its offerings include checking and savings accounts, commercial real estate and business loans, consumer credit, online and mobile banking, and investment and advisory services.

Columbia Banking System traces its roots to the formation of Columbia State Bank in Washington in 1993.