Popular (BPOP) Up 7.4% Since Last Earnings Report: Can It Continue?

A month has gone by since the last earnings report for Popular (BPOP). Shares have added about 7.4% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Popular due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Popular Q4 Earnings Beat Estimates on Higher NII & Fee Income Growth

Popular’s fourth-quarter 2025 adjusted earnings per share of $3.40 surpassed the Zacks Consensus Estimate of $3.02. The bottom line compared favorably with $2.51 in the year-ago quarter.

The results benefited primarily from a rise in net interest income (NII), fee income and loan balances. However, lower deposit balance, elevated operating expenses and higher provisions were headwinds.

Quarterly results in the reported quarter excluded the impact of a partial release of the FDIC special assessment reserve. After considering it, net income (GAAP basis) came in at $233.9 million, which rose 31.5% year over year.

For 2025, adjusted earnings per share of $12.18 beat the Zacks Consensus Estimate of $11.81. The figure represented a rise of 35% from the previous year. Net income (GAAP basis) was $833.2 million, up 35.6% year over year.

Revenues & Expenses Rise Y/Y

Total quarterly revenues were $823.8 million, rising 9.1% from the year-ago quarter. The top line beat the Zacks Consensus Estimate of $814.9 million.

For 2025, total revenues were $3.2 billion, up 8.8%. The top line came marginally above the Zacks Consensus Estimate of $3.19 billion.

Quarterly NII was $657.6 million, up 11.3% year over year. Also, net interest margin (non-taxable equivalent basis) expanded 26 basis points to 3.61%.

Non-interest income increased 1% to $166.3 million. The rise was primarily driven by an increase in service charges on deposit accounts, other service fees and net gain on trading account debt securities.

Total operating expenses increased 1.2% to $473.2 million. The rise mainly stemmed from an increase in total personnel costs, total processing and transactional services and total business promotion.

Loans Balance Rise & Deposit Balance Fall Sequentially

As of Dec. 31, 2025, total loans held-in-portfolio increased 1.6% on a sequential basis to $38.5 billion. Total deposits were $66.2 billion, down marginally from the previous quarter.

Credit Quality Deteriorates

In the fourth quarter of 2025, Popular recorded a provision for credit losses of $71.4 million, up 3.3% from the prior-year quarter.

As of Dec. 31, 2025, non-performing assets were $540.8 million, which increased 32.5% year over year. The non-performing assets to total assets ratio was 0.72% compared with 0.56% as of Dec. 31, 2024.

Capital Ratios Decline

As of Dec. 31, 2025, the Common Equity Tier 1 capital ratio and the Tier 1 capital ratio were 15.72% and 15.77%, respectively, down from 16.03% and 16.08% in the year-ago quarter.

Share Repurchase Update

In the reported quarter, the company repurchased 1.25 million shares of common stock for $147.8 million.

Outlook

2026

Total loans are anticipated to increase 3–4% from the 2025 reported level, driven primarily by solid commercial loan growth.

Management expects NII to grow 5–7% year over year, supported by continued loan growth and lower funding costs of Puerto Rico public deposits.

Management expects non-interest income to remain in the $160–$165 million range per quarter in 2026.

Total GAAP operating expenses are projected to increase approximately 3% year over year, reflecting continued investments in personnel and technology.

Net charge-offs are expected to be in the range of 55–70 basis points, reflecting stable credit trends and the broader economic outlook.

The effective tax rate for 2026 is expected to be 15–17%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates revision.

The consensus estimate has shifted 7.79% due to these changes.

VGM Scores

At this time, Popular has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Charting a somewhat similar path, the stock was allocated a score of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Popular has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry Player

Popular belongs to the Zacks Banks - Southeast industry. Another stock from the same industry, SouthState (SSB), has gained 1.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2025.

SouthState reported revenues of $686.87 million in the last reported quarter, representing a year-over-year change of +52.5%. EPS of $2.47 for the same period compares with $1.93 a year ago.

SouthState is expected to post earnings of $2.22 per share for the current quarter, representing a year-over-year change of +3.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.1%.

SouthState has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.

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This article originally published on Zacks Investment Research (zacks.com).

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