Can Valley National (VLY) Maintain Resilience Amid Ongoing Declines in Revenue and Earnings?

• Valley National Bancorp recently reported that its revenue has declined by 2.1% annually over the past two years, accompanied by a 4.5% annual fall in earnings per share over the last five years and a Tier 1 capital ratio averaging 9.9% over two years.
• This combination of lower profitability and a relatively low capital buffer is prompting increased scrutiny of the company's operational stability and financial resilience.
• Given the company's recent declines in revenue and earnings, we now examine how these developments may influence Valley National Bancorp's investment outlook.

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Valley National Bancorp Investment Narrative Recap

To invest in Valley National Bancorp, you need to believe in the company's long-term ability to stabilize profitability and grow earnings, despite recent declines in both revenue and earnings per share. The latest figures reinforce that the short-term outlook hinges on the company’s capacity to defend its margins amid ongoing earnings pressure, while the biggest risk remains its relatively low Tier 1 capital ratio, which could limit flexibility if market conditions deteriorate. Overall, the recent news does not materially change the critical near-term catalyst: maintaining profitability while managing capital requirements.

Of the many recent announcements, the upcoming Q3 2025 earnings release on October 23 is most relevant, as it will signal if revenue and net income trends are stabilizing and whether previously reported improvements in net interest income can offset structural profitability challenges. Investors may look to this update for cues about the company’s ability to rebuild its financial resilience and address concerns over capital adequacy.

However, in contrast to recent earnings improvements, investors should be aware of Valley National’s ongoing exposure to regional risks if...

Read the full narrative on Valley National Bancorp (it's free!)

Valley National Bancorp is projected to reach $2.5 billion in revenue and $807.5 million in earnings by 2028. This outlook assumes a 16.6% annual revenue growth rate and an increase in earnings of $381.8 million from the current earnings of $425.7 million.

Uncover how Valley National Bancorp's forecasts yield a $12.50 fair value, a 19% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community estimates for fair value range from US$8.34 to US$60, based on four individual forecasts. While analyst consensus highlights earnings and capital stability as the key drivers, readers can review these different perspectives to inform their own view of Valley National Bancorp’s prospects.

Explore 4 other fair value estimates on Valley National Bancorp - why the stock might be worth over 5x more than the current price!

Build Your Own Valley National Bancorp Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Valley National Bancorp research is our analysis highlighting 5 key rewards that could impact your investment decision.
• Our free Valley National Bancorp research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Valley National Bancorp's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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