NYSE:WBS

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Webster Financial Corporation operates as the holding company for Webster Bank, National Association that provides a range of banking, investment, and financial services to individuals, families, and businesses in the United States.


Snowflake Analysis

Flawless balance sheet 6 star dividend payer.


Similar Companies

Share Price & News

How has Webster Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WBS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-0.4%

WBS

-1.7%

US Banks

1.9%

US Market


1 Year Return

-42.3%

WBS

-27.6%

US Banks

4.3%

US Market

Return vs Industry: WBS underperformed the US Banks industry which returned -27.6% over the past year.

Return vs Market: WBS underperformed the US Market which returned 4.3% over the past year.


Shareholder returns

WBSIndustryMarket
7 Day-0.4%-1.7%1.9%
30 Day-5.1%-4.3%2.7%
90 Day29.0%11.3%26.4%
1 Year-39.9%-42.3%-25.0%-27.6%6.5%4.3%
3 Year-45.5%-49.9%-18.1%-24.7%35.1%26.2%
5 Year-20.4%-30.3%11.4%-2.1%67.0%48.4%

Price Volatility Vs. Market

How volatile is Webster Financial's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Webster Financial undervalued compared to its fair value and its price relative to the market?

7.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WBS ($27.05) is trading below our estimate of fair value ($29.1)

Significantly Below Fair Value: WBS is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: WBS is good value based on its PE Ratio (7.9x) compared to the Banks industry average (9.5x).

PE vs Market: WBS is good value based on its PE Ratio (7.9x) compared to the US market (16.4x).


Price to Earnings Growth Ratio

PEG Ratio: WBS is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: WBS is overvalued based on its PB Ratio (0.8x) compared to the US Banks industry average (0.8x).


Next Steps

Future Growth

How is Webster Financial forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

8.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WBS's forecast earnings growth (8.7% per year) is above the savings rate (2.2%).

Earnings vs Market: WBS's earnings (8.7% per year) are forecast to grow slower than the US market (22.7% per year).

High Growth Earnings: WBS's earnings are forecast to grow, but not significantly.

Revenue vs Market: WBS's revenue (1.2% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: WBS's revenue (1.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WBS's Return on Equity is forecast to be low in 3 years time (8.8%).


Next Steps

Past Performance

How has Webster Financial performed over the past 5 years?

16.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WBS has high quality earnings.

Growing Profit Margin: WBS's current net profit margins (27.6%) are lower than last year (31.5%).


Past Earnings Growth Analysis

Earnings Trend: WBS's earnings have grown by 16.8% per year over the past 5 years.

Accelerating Growth: WBS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WBS had negative earnings growth (-16.1%) over the past year, making it difficult to compare to the Banks industry average (1.9%).


Return on Equity

High ROE: WBS's Return on Equity (10.4%) is considered low.


Next Steps

Financial Health

How is Webster Financial's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: WBS's Assets to Equity ratio (10.2x) is moderate.

Allowance for Bad Loans: WBS has a sufficient allowance for bad loans (206%).

Low Risk Liabilities: 86% of WBS's liabilities are made up of primarily low risk sources of funding.

Loan Level: WBS has an appropriate level of Loans to Assets ratio (65%).

Low Risk Deposits: WBS's Loans to Deposits ratio (84%) is appropriate.

Level of Bad Loans: WBS has an appropriate level of bad loans (0.8%).


Next Steps

Dividend

What is Webster Financial current dividend yield, its reliability and sustainability?

5.91%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: WBS's dividend (5.91%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: WBS's dividend (5.91%) is in the top 25% of dividend payers in the US market (4.49%)


Stability and Growth of Payments

Stable Dividend: WBS's dividends per share have been stable in the past 10 years.

Growing Dividend: WBS's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (46.9%), WBS's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WBS's dividends in 3 years are forecast to be covered by earnings (56.7% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.5yrs

Average management tenure


CEO

John Ciulla (54yo)

2.5yrs

Tenure

US$3,582,866

Compensation

Mr. John R. Ciulla has been the President of Webster Financial Corp. since October 28, 2015 and has been its Chief Executive Officer and a Director since January 1, 2018. He serves as Chairman of the Board ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD3.58M) is below average for companies of similar size in the US market ($USD5.86M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
John Ciulla
Chairman2.5yrsUS$3.58m0.11% $2.8m
Glenn MacInnes
Executive VP & CFO9.17yrsUS$1.53m0.13% $3.1m
Nitin Mhatre
Executive VP & Head of Community Banking11.5yrsUS$1.13m0.055% $1.3m
Charles Wilkins
Executive Vice Presidentno dataUS$1.09m0.032% $777.8k
Christopher Motl
Executive VP & Head of Commercial Banking3.5yrsUS$1.48m0.042% $1.0m
Albert Wang
Senior VP & Chief Accounting Officer2.83yrsno data0.0035% $84.9k
Karen Higgins-Carter
Executive VP & Chief Information Officer2yrsno data0.0052% $126.3k
Terrence Mangan
Senior Vice President of Investor Relationsno datano datano data
Harriet Wolfe
Executive VP20.83yrsno data0.12% $3.0m
Bernard Garrigues
Executive VP & Chief Human Resources Officerno datano data0.024% $586.6k

3.5yrs

Average Tenure

54yo

Average Age

Experienced Management: WBS's management team is considered experienced (3.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Ciulla
Chairman2.5yrsUS$3.58m0.11% $2.8m
Laurence Morse
Independent Director16.5yrsUS$133.64k0.039% $953.7k
Karen Osar
Independent Director14.25yrsUS$141.64k0.028% $692.0k
William Atwell
Lead Independent Directorno dataUS$156.84k0.037% $911.7k
James Bush
Independent Director0.083yrno data0.0022% $54.1k
Mark Pettie
Independent Director11.25yrsUS$139.64k0.038% $929.0k
Elizabeth Flynn
Independent Director5.83yrsUS$128.02k0.034% $824.4k
E. Hayles
Independent Director1.75yrsUS$126.97k0.0067% $163.2k
Lauren States
Independent Director3.83yrsUS$123.27k0.0088% $214.9k
Linda Ianieri
Independent Director0.25yrno data0.0036% $88.1k

3.8yrs

Average Tenure

63yo

Average Age

Experienced Board: WBS's board of directors are considered experienced (3.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: WBS insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Webster Financial Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Webster Financial Corporation
  • Ticker: WBS
  • Exchange: NYSE
  • Founded: 1935
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$2.439b
  • Shares outstanding: 90.17m
  • Website: https://public.websteronline.com

Number of Employees


Location

  • Webster Financial Corporation
  • 145 Bank Street
  • Waterbury
  • Connecticut
  • 6702
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WBSNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 1986
WEDDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1986
WBS.PRFNYSE (New York Stock Exchange)DEP SHS RP PFD FUSUSDDec 2017

Biography

Webster Financial Corporation operates as the holding company for Webster Bank, National Association that provides a range of banking, investment, and financial services to individuals, families, and businesses in the United States. It operates through three segments: Commercial Banking, HSA Bank, and Community Banking. The Commercial Banking segment provides lending, deposit, and cash management services to middle market companies; and commercial and industrial lending and leasing, commercial real estate lending, equipment financing, and asset-based lending, as well as treasury and payment services. This segment also offers asset management, financial planning and trust services, and deposit and loan products for high net worth clients, not-for-profit organizations, and business clients. The HSA Bank segment offers health savings accounts, health reimbursement accounts, flexible spending accounts, and other financial solutions to employers for the benefit of their employees and individuals. The Community Banking segment offers deposit and fee-based services, residential mortgages, home equity lines or loans, unsecured consumer loans, and credit cards to consumers, as well as investment and securities-related services, including brokerage and investment advice through a strategic partnership with LPL Financial Holdings Inc. This segment also provides credit, deposit, and cash flow management products to businesses and professional service firms. The company also offers online and mobile banking services, as well as through its Website. As of April 7, 2020, it operated 157 banking centers and 309 ATMs. Webster Financial Corporation was founded in 1935 and is headquartered in Waterbury, Connecticut. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/01 23:54
End of Day Share Price2020/07/01 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.