Webster Financial: Truist Securities Maintains Buy Rating, PT Down to $67

Webster Financial: Truist Securities Maintains Buy Rating, PT Down to $67

Truist Securities has maintained its Buy rating on Webster Financial (NYSE: WBS) while lowering the price target to $67 from $70, according to a Raymond James note. The update comes following the bank's strong third-quarter 2025 earnings report, which exceeded analyst expectations.

Webster Financial reported an earnings per share (EPS) of $1.54, surpassing the forecast of $1.52, and revenue of $732.6 million, up 2.3% from the previous quarter. Despite these positive results, the stock price dropped by 0.63% in pre-market trading, possibly reflecting broader market trends or investor concerns about potential future challenges, according to the earnings call transcript.

Truist Securities noted that Webster Financial's strong balance sheet, solid credit quality, and minimal non-deposit funding institution risk are key strengths. However, the firm highlighted that tighter loan spreads and origination yields have pressured net interest margin, while higher expenses partially offset earnings per share upside, a point also noted by Raymond James.

The bank has maintained dividend payments for 39 consecutive years, currently offering a 2.95% yield. Truist Securities also pointed out that Webster Financial's shares trade at a price-to-earnings discount compared to peers, making the stock's risk-reward profile favorable.

Looking ahead, Truist Securities anticipates steady loan growth in the mid-single digits for 2026. The firm expects the company to continue investing in digitization and treasury management, with a focus on high-quality loan originations. The guidance for future quarters remains optimistic, with EPS forecasts ranging from $1.50 to $1.57 and revenue projections showing consistent growth.