FinWise Bancorp (NASDAQ:FINW) Posts Earnings Results, Misses Expectations By $0.09 EPS

FinWise Bancorp (NASDAQ:FINW) issued its earnings results on Wednesday. The company reported $0.15 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.24 by ($0.09), FiscalAI reports. The company had revenue of $24.38 million for the quarter, compared to analysts’ expectations of $47.11 million. FinWise Bancorp had a net margin of 9.05% and a return on equity of 8.24%.

Here are the key takeaways from FinWise Bancorp’s conference call:

• Credit costs pressured earnings: Second-quarter net income was $2.1 million, or $0.15 per share, below expectations as provision expense on the core portfolio increased to $6 million. Management expects elevated SBA-related charge-offs to persist for the next few quarters, though the second-quarter provision is viewed as an outlier.
• Non-performing loans declined: NPLs fell from nearly $50 million to approximately $38 million, primarily through collateral resolutions and paydowns. Management said the remaining risk is concentrated in a finite, identified legacy pool and expects credit quality to improve as it is worked down.
• Originations exceeded guidance: Second-quarter originations reached $1.6 billion, above the $1.4 billion outlook and up approximately 8% year over year. Management expects roughly $1.6 billion in the third quarter and a $1.4 billion baseline for the fourth quarter.
• Fintech pipeline strengthened: FinWise signed a new prepaid-card partnership using its BIN sponsorship and MoneyRails services, with a fourth-quarter launch expected. Management said the pipeline is materially stronger than in prior years and anticipates additional meaningful deals before year-end.
• Credit-enhanced balance guidance was withdrawn: The prior target of approximately $217 million by year-end 2026 no longer applies because the Tallied acquisition shifted some balances into the direct portfolio. Existing-partner growth is expected to continue, but meaningful expansion beyond 2026 will depend on adding new partners; Tallied also brings roughly $4 million of integration and transition costs over the next year.

FinWise Bancorp Price Performance

NASDAQ:FINW opened at $14.10 on Thursday. FinWise Bancorp has a 1-year low of $12.82 and a 1-year high of $22.49. The company has a 50-day moving average of $14.20 and a 200 day moving average of $15.60. The firm has a market cap of $193.31 million, a PE ratio of 12.82 and a beta of 0.70.

Analyst Ratings Changes

A number of equities research analysts recently weighed in on FINW shares. Weiss Ratings lowered shares of FinWise Bancorp from a “hold (c+)” rating to a “hold (c)” rating in a report on Wednesday, May 6th. Wall Street Zen raised shares of FinWise Bancorp from a “sell” rating to a “hold” rating in a research report on Sunday, July 12th. Finally, Zacks Research raised shares of FinWise Bancorp from a “strong sell” rating to a “hold” rating in a research note on Tuesday, June 30th. One research analyst has rated the stock with a Buy rating and two have issued a Hold rating to the company. Based on data from MarketBeat, FinWise Bancorp has an average rating of “Hold” and a consensus target price of $22.00.

FinWise Bancorp announced that its board has authorized a stock repurchase plan on Thursday, May 21st that permits the company to repurchase 685,000,000,000 shares. This repurchase authorization permits the company to repurchase up to 5% of its stock through open market purchases. Stock repurchase plans are usually a sign that the company’s board of directors believes its stock is undervalued.

Institutional Investors Weigh In On FinWise Bancorp

Large investors have recently modified their holdings of the business. BNP Paribas Financial Markets purchased a new stake in shares of FinWise Bancorp in the 2nd quarter worth approximately $25,000. Bank of America Corp DE increased its holdings in FinWise Bancorp by 3,887.7% during the second quarter. Bank of America Corp DE now owns 2,911 shares of the company’s stock valued at $44,000 after buying an additional 2,838 shares during the period. JPMorgan Chase & Co. bought a new position in FinWise Bancorp in the second quarter worth approximately $65,000. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. bought a new position in FinWise Bancorp in the second quarter worth approximately $74,000. Finally, Cubist Systematic Strategies LLC purchased a new stake in FinWise Bancorp during the first quarter worth $104,000. Institutional investors own 35.41% of the company’s stock.

FinWise Bancorp Company Profile

FinWise Bancorp is the bank holding company for FinWise Bank, a digital‐first community bank headquartered in Lindon, Utah. The company specializes in providing commercial lending and deposit products to marketplace lending platforms, fintech companies and small to mid‐sized businesses across the United States. FinWise Bancorp operates through its wholly owned subsidiary, FinWise Bank, which is FDIC‐insured and leverages a technology‐driven model to deliver banking services efficiently.

The company’s primary business activities include participant financing arrangements for marketplace lenders and other fintech platforms, as well as direct commercial loans.