Live Oak Bancshares Q3 revenue beats estimates as loan production increases

By Reuters News


Overview

  • U.S. regional bank's Q3 revenue rose 23% yr/yr, beating analyst expectations

  • Net income attributable to common shareholders fell 5% yr/yr, diluted EPS was $0.52

  • Q3 provision for credit losses in rose to $54.7 mln, driven by stressed distillery portfolio and loan growth


Outlook

  • Company did not provide specific financial guidance for upcoming quarters or full year in its press release


Result Drivers

  • REVENUE GROWTH OUTPACES EXPENSES - Co said revenue growth was meaningfully ahead of expense growth, supporting earnings power

  • RECORD LOAN PRODUCTION - Co reported strong loan production of $2.1 bln in Q3, with total assets up 5.8% sequentially

  • ELEVATED PROVISION EXPENSE - Higher provision for credit losses was driven by action on stressed distillery portfolio and reserves for loan growth


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

Beat

$175.65 mln

$159.40 mln (4 Analysts)

Q3 EPS

$0.52

Q3 Net Income

$24.26 mln

Q3 Net Interest Income

$133.009 mln


Analyst Coverage

  • The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 3 "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 Live Oak Bancshares, Inc. is $42.50, about 20.2% above its October 20 closing price of $35.36

  • The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 12 three months ago


Reuters Recommended Reads

  • Oct 19 - Fifth Third Bancorp Q3 net interest income jumps on Comerica acquisition

  • Oct 19 - Western Alliance Bancorp Q3 revenue slightly beats estimates, profit rises on wider interest margin

  • Oct 20 - East West Bancorp Q3 revenue beats estimates on loan and deposit 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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