Norwood Financial (NASDAQ:NWFL) Posts Quarterly Earnings Results, Beats Expectations By $0.13 EPS

Norwood Financial (NASDAQ:NWFL) posted its quarterly earnings data on Tuesday. The financial services provider reported $1.08 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.95 by $0.13, FiscalAI reports. Norwood Financial had a return on equity of 13.53% and a net margin of 19.67%. The company had revenue of $3.27 million during the quarter, compared to analysts’ expectations of $30.00 million.

Here are the key takeaways from Norwood Financial’s conference call:

• Record third-quarter results: Net income reached $11.8 million, or $1.08 per diluted share, while net interest income rose 37% year over year to $28 million. Net interest margin expanded 38 basis points to 4.01%, and return on average assets was 1.60%.
• Operating performance benefited from the larger post-Presence Bank balance sheet and improving efficiency, with pre-provision net revenue up 53% year over year to $15.4 million. Merger-related expenses were essentially complete, with none recorded in the quarter.
• A favorable development in a previously disclosed borrower bankruptcy generated approximately $400,000 of interest and fee income, reduced the bank’s exposure, and drove a significant improvement in non-performing loans. Provision for credit losses fell to $100,000 from $1.9 million in the second quarter.
• Management expects continued loan and margin support from loans repricing upward, lower retail CD costs, and a strong pipeline, but does not anticipate significant further margin expansion as rates rise. The bank also noted that roughly $7 million of remaining exposure remains on non-accrual and may require a longer workout, although management does not foresee a large loss.
• Fee-income initiatives are gaining traction, including a 41% year-over-year improvement in brokerage revenue following the transition to Cetera Wealth Services. Management views fee-income growth as sustainable and potentially expandable, while maintaining an active but selective approach to future M&A.

Norwood Financial Trading Down 0.4%

NWFL opened at $35.51 on Friday. The company has a debt-to-equity ratio of 0.23, a quick ratio of 0.91 and a current ratio of 0.91. Norwood Financial has a one year low of $25.73 and a one year high of $37.39. The company has a market cap of $387.06 million, a P/E ratio of 11.49 and a beta of 0.56. The business’s 50-day simple moving average is $34.24 and its 200-day simple moving average is $31.62.

Norwood Financial Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Monday, November 2nd. Stockholders of record on Thursday, October 15th will be issued a $0.32 dividend. This represents a $1.28 dividend on an annualized basis and a dividend yield of 3.6%. The ex-dividend date is Thursday, October 15th. Norwood Financial’s dividend payout ratio (DPR) is presently 41.42%.

Insider Transactions at Norwood Financial

In related news, EVP Vincent O’bell sold 3,000 shares of the stock in a transaction on Wednesday, September 2nd. The shares were sold at an average price of $34.52, for a total transaction of $103,560.00. Following the completion of the sale, the executive vice president owned 4,392 shares in the company, valued at $151,611.84. This represents a 40.58% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. 8.10% of the stock is owned by corporate insiders.

Analyst Upgrades and Downgrades

NWFL has been the topic of a number of recent analyst reports. Stephens reiterated a “mixed” rating and set a $35.00 price target (up from $34.00) on shares of Norwood Financial in a research report on Thursday, July 23rd. Weiss Ratings restated a “buy (b)” rating on shares of Norwood Financial in a report on Thursday, October 22nd. One equities research analyst has rated the stock with a Buy rating and one has assigned a Hold rating to the company. Based on data from MarketBeat.com, Norwood Financial currently has a consensus rating of “Moderate Buy” and a consensus target price of $35.00.

Norwood Financial Company Profile

Norwood Financial Corp. is the bank holding company for Wayne Bank, a community banking institution headquartered in Honesdale, Pennsylvania. Through Wayne Bank, the company provides banking and financial services to individuals, families, businesses, and nonprofit organizations.

Wayne Bank offers deposit products, including checking, savings, money market, and certificate of deposit accounts, along with consumer, residential mortgage, commercial, and real estate lending. Its services also include online and mobile banking, cash management, debit cards, and other electronic banking solutions.

Founded in 1870, Wayne Bank serves communities in northeastern Pennsylvania and the Catskill and Hudson Valley regions of New York through its branch network and digital channels.