Coastal Financial Q3 profit misses estimates

By Reuters News


Overview

  • US community bank and BaaS provider's Q3 adjusted EPS missed analyst expectations

  • Net income for Q3 missed analyst expectations

  • BaaS program fee income rose 18% from prior qtr, up 80% yr/yr


Outlook

  • Company expects new partnership opportunities and product launches for remainder of 2026

  • Expansion of partner initiatives expected to drive higher partner revenue in upcoming periods

  • Company targets up to $20 mln in annualized noninterest expense savings over next 4–6 qtrs


Result Drivers

  • BAAS FEE INCOME - Co said growth in BaaS program fee income was driven by higher partner activity and expansion of partner programs

  • LOWER EXPENSES - Co attributed lower noninterest expense to absence of prior quarter's credit enhancement valuation adjustment and reduced data processing, BaaS loan, and salary costs

  • CREDIT PERFORMANCE - Co said stabilization in partner credit performance and lower net charge-offs contributed to improved asset quality


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 EPS

Miss

$0.89

$0.98 (4 Analysts)

Q3 Net Income

Miss

$13.79 mln

$15.03 mln (4 Analysts)

Q3 Net Interest Income

$88.29 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the banks peer group is "buy"

  • Wall Street's median 12-month price target for Coastal Financial Corp (EVERETT) is $51.50, about 9.3% above its October 28 closing price of $47.13

  • The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 14 three months ago


Reuters Recommended Reads

  • Oct 28 - First US Bancshares Q3 EPS rises, net interest margin improves

  • Oct 28 - Hope Bancorp Q3 net income rises 16% year over year

  • Oct 27 - CF Bankshares Q3 net income jumps 158% on loan growth


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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