Latest news with #WTFC
Business Wire
21-05-2025
- Business
- Business Wire
KBRA Assigns Ratings to Wintrust Financial Corporation
NEW YORK--(BUSINESS WIRE)--KBRA assigns a senior unsecured debt rating of A-, a subordinated debt rating of BBB+, a preferred stock rating of BBB, and a short-term debt rating of K2 to Rosemont, Illinois-based Wintrust Financial Corporation (NASDAQ: WTFC) ('the company'). KBRA also assigns deposit and senior unsecured debt ratings of A and short-term deposit and debt ratings of K1 to all 16 of WTFC's bank subsidiaries: Lake Forest Bank & Trust Company, N.A., Barrington Bank & Trust Company, N.A., Wintrust Bank, N.A., Libertyville Bank & Trust Company, N.A., Northbrook Bank & Trust Company, N.A., Village Bank & Trust, N.A., Wheaton Bank & Trust Company, N.A., State Bank of the Lakes, N.A., Crystal Lake Bank & Trust Company, N.A., Schaumburg Bank & Trust Company, N.A., Beverly Bank & Trust Company, N.A., Old Plank Trail Community Bank, N.A., Hinsdale Bank & Trust Company, N.A., St. Charles Bank & Trust Company, N.A., Town Bank, N.A., and Macatawa Bank, N.A. The Outlook for all long-term ratings is Stable. Key Credit Considerations WTFC's ratings reflect its consistent earnings performance driven by a conservative risk appetite and strategic execution. Ratings are also supported by the firm's relative scale and asset diversification built through a combination of organic growth. WTFC has produced consistently favorable operating results over a long period (remaining profitable during the GFC) driven by a high-quality, long-tenured management team that has exhibited a conservative risk stance which has allowed it to be opportunistic during times of market dislocation. While earnings are not necessarily peer-leading, we note that performance has been generally less volatile than peers. As noted, the consistency of WTFC's operating performance can mostly be attributed to its good credit performance, supported by conservative underwriting in its community banking book and its purposeful exposure to low loss generating insurance premium finance loans. By design, management has historically operated with a diversified, granular loan portfolio with one-third of loans made up of insurance premium finance loans which have generated very low historical losses over time. This is a key differentiator for WTFC relative to regional banking peers rated by KBRA. Over the last 25 years, the company's NCO ratio has averaged just 0.26%, outperforming most peers, especially ones that operated primarily in the Chicagoland/Midwestern area. In more recent periods, while NPLs both in dollar terms and as a proportion of the loan book have ticked up, they remain quite low at under 0.40% of loans, relatively stable from recent periods and below similarly rated peers. WTFC's capital levels are reasonable in the context of its earnings power and risk profile. The firm has managed its CET1 ratio up to over 10% at 1Q25 which is towards the lower end of peers. However, we note that the firm's RWA density tends to be higher, driven by the aforementioned premium finance portfolio which is risk-weighted at 100% but has very low loss content. Thus, on a risk adjusted basis, we see the 10%+ CET1 ratio as supportive of the ratings. The company is primarily core deposit funded, benefitting from community banking-like relationships in its core markets and its ability to offer 16x the FDIC limit through its MaxSafe product which allows customers to spread their deposit accounts across its 16 charters. At 1Q25, WTFC's loan-to-deposit ratio was slightly above its target range of 85% to 90%, but we take comfort in management's historically conservative stance in where to manage the metric. Rating Sensitivities At the assigned rating level, KBRA believes ratings are well-positioned. Continued growth in low-cost deposits / related fee income would be viewed favorably over the longer-term. An increase in risk tolerance, unexpected asset quality deterioration, or more aggressive financial management could have negative rating ramifications. To access ratings and relevant documents, click here. Methodologies Disclosures A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here. Information on the meaning of each rating category can be located here. Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at About KBRA Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan's Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S. Doc ID: 1009493
Yahoo
23-04-2025
- Business
- Yahoo
Valmont Industries Inc (VMI) Q1 2025 Earnings Call Highlights: Navigating Challenges with ...
Net Sales: $969.3 million, a decrease of 0.9% year-over-year. Gross Margin: 30%, a decrease of 130 basis points from the prior year. Operating Income: $128.3 million, or 13.2% of sales. Diluted Earnings Per Share: $4.32, in line with the prior year period. Infrastructure Sales: Decreased 2.4%; telecom and utility growth offset by lower solar and lighting sales. Utility Sales: Increased 2.4%, driven by higher volumes and selling prices. Telecommunications Sales: Nearly 30% growth due to favorable carrier spending. Agriculture Sales: Increased 3.3%, approximately 6% on a constant currency basis. Operating Cash Flow: $65.1 million, driven by earnings and lower inventory. Capital Expenditures: $30.3 million, primarily for capacity expansion in the Infrastructure segment. Dividend Increase: 13% increase announced during the quarter. Stock Repurchase Program: $59 million of shares repurchased in the second quarter at an average price of $269 per share. 2025 Outlook: Net sales projected between $4.0 billion to $4.2 billion; EPS expected between $17.20 to $18.80. Warning! GuruFocus has detected 4 Warning Sign with WTFC. Release Date: April 22, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Valmont Industries Inc (NYSE:VMI) reported a strong backlog of $1.5 billion, indicating healthy order activity and volume growth. The company is actively mitigating tariff risks with a local for local supply chain strategy, reducing exposure to international tariffs. Valmont Industries Inc (NYSE:VMI) is investing in capacity expansion, with $30 million in CapEx directed towards increasing utility production. The telecommunications segment saw a robust 30% growth, driven by carrier spending on 5G upgrades and modernization. Valmont Industries Inc (NYSE:VMI) is implementing cost optimization initiatives, which could result in $15 million to $20 million in savings once fully implemented. Consolidated net sales decreased by 0.9% year-over-year, with a decline in gross margin due to a higher mix of lower-margin international projects. The agriculture segment is facing challenges due to lower crop prices and pressured farm income, impacting North American market conditions. Solar sales declined by more than 50%, reflecting lower volumes and the strategic decision to exit low-margin projects. The lighting markets have been soft, with international sales exposure facing challenges, particularly in the Asia-Pacific region. Tariffs resulted in a $3 million cost in the first quarter, although the company expects to be cost-neutral by the end of the year. Q: Have price actions been implemented to offset all of the tariff impacts to date, and is there any type of lag that we should expect from pricing? A: Thomas Liguori, Executive Vice President and Chief Financial Officer, explained that the team has done a good job mitigating tariffs, aiming for cost neutrality for the year. About half of the $80 million tariff exposure is managed through pricing, with the rest through supply chain adjustments. There might be a lag in pricing as backlog items are generally not repriced, with effects more visible in the second half of the year. Q: How should we think about the telecom business for the rest of the year, given the strong 30% growth in the first quarter? A: Avner Applbaum, President and Chief Executive Officer, noted that telecom has stabilized after a period of reduced carrier spending. Carriers are investing in 5G upgrades and modernization, with strong order rates expected to continue. The company is closely aligned with carrier investments, such as AT&T's RAN transition, and remains optimistic about ongoing carrier spending. Q: If steel prices increase significantly, how will that affect the second half earnings? A: Thomas Liguori mentioned that while steel prices rose earlier, they are starting to moderate, with futures indicating a decline in the second half. The company is working with suppliers to reduce costs, including freight and value-added operations, which should positively impact the year's end results. Q: Is the expectation for the North American irrigation market weaker now than it was three months ago? A: Avner Applbaum confirmed that the North American irrigation market is expected to be challenging due to uncertainty, leading farmers to delay investments. Despite this, the company continues to invest in technology and strategic accounts to be ready when the market recovers. Q: Can you elaborate on the order trends in Brazil and whether this indicates a true recovery? A: Avner Applbaum stated that after a tough year, Brazil is showing signs of stabilization with increasing order activity. While margins remain under pressure, the company is investing with dealers for future growth, and the region is expected to benefit from global trade dynamics. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
21-04-2025
- Business
- Yahoo
American Financial Group Inc (AFG) Q4 2024 Earnings Call Highlights: Strong Returns and ...
Core Net Operating Earnings Per Share (Full-Year 2024): $10.75 Core Operating Return on Equity (Full-Year 2024): 19.3% Capital Returned to Shareholders (2024): $791 million Special Dividends (2024): $6.50 per share Regular Common Stock Dividends (2024): $246 million Growth in Book Value Per Share (Excluding AOCI, 2024): 19.6% Fourth-Quarter Core Net Operating Earnings Per Share (2024): $3.12 Annualized Fourth-Quarter Core Return on Equity (2024): 21.9% Property and Casualty Net Investment Income (Full-Year 2024): $784 million Combined Ratio (Fourth-Quarter 2024): 89% Net Written Premiums Growth (Full-Year 2024): 7% Average Renewal Pricing (Excluding Workers' Comp, Fourth-Quarter 2024): Up 8% Specialty Financial Group Combined Ratio (Fourth-Quarter 2024): 80.7% Net Written Premiums Growth (Fourth-Quarter 2024): 1% Investment Portfolio (End of 2024): $15.9 billion Warning! GuruFocus has detected 4 Warning Sign with WTFC. Release Date: February 05, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. American Financial Group Inc (NYSE:AFG) reported a strong annual core operating return on equity of 19.3% for 2024. Net written premiums grew by 7% during the year, showcasing robust business growth. AFG returned $791 million to shareholders in 2024, including significant special and regular dividends. The company achieved a 19.6% growth in book value per share, excluding AOCI plus dividends, in 2024. AFG's specialty property and casualty businesses reported a strong combined ratio of 89% for the fourth quarter of 2024. AFG experienced adverse prior-year development in its specialty casualty group, particularly in social inflation-exposed businesses. The company faced a higher combined ratio of 92.5% projected for 2025, reflecting anticipated challenges. AFG's property and transportation group saw a 6% decrease in gross and net written premiums in the fourth quarter of 2024. The company anticipates losses related to the Southern California wildfires, estimated between $60 million to $70 million. AFG's commercial auto liability segment is still working towards achieving an underwriting profit, facing challenges from social inflation. Q: Can you provide more details on the losses from the California wildfires? A: The losses are primarily from our property-oriented businesses, including lender-placed property, property in marine, and nonprofit businesses with property exposures in California. - Carl Lindner, Co-CEO Q: Could you elaborate on the expense ratio pressures mentioned? A: The higher expense ratio is due to growth in businesses like our financial institution business, which has a higher commission ratio compared to others like workers' comp. We focus on overall return rather than just the expense ratio. - Brian Hertzman, CFO Q: Can you explain the casualty reserve development in the quarter? A: The adverse development is mainly from an excess liability unit focusing on larger entities like Fortune 500 companies. We assess each business quarterly and adjust reserves based on loss ratio trends. - Carl Lindner, Co-CEO Q: Regarding the 92.5% combined ratio guide for 2025, are you expecting higher workers' comp and casualty loss ratios? A: Yes, we anticipate a higher workers' comp loss ratio due to tempered expectations for favorable development. However, we expect improved loss ratios in other casualty businesses due to underwriting actions and rate increases. - Brian Hertzman, CFO Q: How should we view the growth potential in specialty casualty given the strong rate increases? A: Excluding workers' comp, we are growing at high-single digits. We could see additional growth if workers' comp pricing stabilizes. - Carl Lindner, Co-CEO Q: What is the impact of crop yield changes on your 2025 guidance? A: The main change was due to lower-than-expected soybean yields in certain states, which affected our 2024 results. We are still settling claims, and this variability impacts our guidance. - Carl Lindner, Co-CEO Q: Can you discuss the commercial auto line's profitability and social inflation impact? A: We are achieving small underwriting profits in commercial auto overall, with strong ROE. We are focused on improving margins, especially in commercial auto liability, which is affected by social inflation. - Carl Lindner, Co-CEO Q: How are you addressing increased severity in older accident years? A: We adjust loss picks based on increased severity observed in older years and apply these trends to more recent years. This is offset by positive impacts from rate increases and underwriting actions. - Brian Hertzman, CFO For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
21-04-2025
- Business
- Yahoo
Wintrust Financial Corp (WTFC) Q4 2024 Earnings Call Highlights: Record Net Income and Balanced ...
Full-Year Net Income: $695 million, up over 11.5% from 2023. Fourth-Quarter Net Income: Approximately $185.4 million. Net Interest Income: Increased by $22.6 million from the prior quarter. Net Interest Margin: 3.51%, stable compared to the prior quarter. Loan Growth: $1 billion for the quarter, 8% annualized. Deposit Growth: $1.1 billion for the quarter, 9% annualized. Total Assets: Grew approximately $1.1 billion to $64.9 billion. Provision for Credit Losses: $17 million in the fourth quarter, down from $22.3 million in the prior quarter. Non-Interest Income: Stable at approximately $113 million for the quarter. Non-Interest Expenses: Totaled $368.5 million, up approximately $7.9 million from the third quarter. Non-Performing Loans: Decreased from 38 basis points to 36 basis points of total loans. Charge-Offs: $15.9 million or 13 basis points, down from $26.7 million or 23 basis points in Q3. CRE Office Exposure: $1.7 billion, 12.8% of total CRE portfolio, 3.5% of total loan portfolio. Warning! GuruFocus has detected 4 Warning Sign with WTFC. Release Date: January 22, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Wintrust Financial Corp (NASDAQ:WTFC) reported record net income of $695 million for 2024, marking an 11.5% increase from 2023. The company achieved balanced growth in loans and deposits, each increasing by approximately $1 billion in the fourth quarter. Net interest income rose by 4.5% quarter over quarter and nearly 12% compared to the previous year's fourth quarter. Non-performing loans and charge-offs decreased relative to the previous quarter, indicating improved credit performance. WTFC's treasury management and wealth businesses continued to show steady growth, contributing to noninterest revenue expansion. The mortgage business remains relatively insignificant in terms of financial impact, with current activity muted. Acquisition-related costs and security losses were noted as uncommon items impacting the quarter's financials. There is increased competitive pressure in the market, particularly in the commercial real estate sector, affecting pricing and structure. Noninterest expenses increased by $7.9 million from the third quarter, partly due to acquisition-related costs and increased software expenses. The company faces challenges from a prolonged higher interest rate environment, particularly affecting commercial real estate valuations. Q: Can you discuss the competitive landscape and your expectations for loan growth in 2025? A: Richard Murphy, Vice Chairman and Chief Lending Officer, noted that while Wintrust has grown when others have not, there is increased competition, particularly in commercial real estate (CRE). The company remains committed to not chasing deals that don't meet their standards. They maintain their guidance for mid- to high single-digit loan growth, despite some headwinds. Q: What is your outlook for the mortgage business given current interest rates? A: Timothy Crane, President and CEO, mentioned that while mortgage activity remains muted, a rate near 6% could stimulate activity. Inventory is improving, and they are hopeful for a spring pickup, but current rates around 7% are less favorable. Q: How are you approaching expense management in 2025? A: David Dykstra, Vice Chairman and COO, emphasized that expense management is a good practice, and they plan to grow expenses at a mid-single-digit rate, which is less than their expected loan growth. They are investing in digital products and infrastructure to support growth. Q: What is your strategy regarding mergers and acquisitions (M&A) and capital priorities? A: Timothy Crane stated that while they field calls and see increased enthusiasm post-election, they remain disciplined. They focus on organic growth and geographic expansion, such as in Rockford, Illinois. Capital is primarily used to support growth, and they are not currently considering buybacks. Q: Can you provide insights into your deposit repricing and margin outlook? A: David Dykstra explained that the interest-bearing deposit beta is around 65-67%, with incremental deposits coming in at 3-4%. They expect the net interest margin to remain around 3.5% throughout 2025, supported by matched loan and deposit growth. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
