Eagle Bancorp Earned 98 Cents per Share

After the bell, Eagle Bancorp (EGBN) reported Q1 earnings of $23.1 million. That works out to 98 cents per share which is a one-penny beat. Eagle now has total assets of $10.01 billion.

Here’s a major footnote. The compensation to the former CEO was $6.2 million, or 13 cents per share. So excluding that, Eagle made a nice $1.11 per share last quarter.

“For the first quarter of 2020, we are pleased to report continued growth in total loans and total deposits, continued superior operating leverage, and stable asset quality,” noted Susan G. Riel, President and Chief Executive Officer of the Company. Ms. Riel continued, “Capital levels remain strong and the Company’s assets ended the first quarter of 2020 at $10.01 billion, representing 19% growth over the first quarter of 2019, with total shareholders’ equity of $1.18 billion. Net income in the first quarter of 2020 resulted in an annualized return on average assets of 0.98% and an annualized return on average tangible common equity of 8.39%.”

(…)

The Company’s performance in the first quarter of 2020 as compared to the first quarter of 2019 was highlighted by growth in average total loans of 8.7%, growth in average total deposits of 10.0%, a net interest margin of 3.49%, and total revenue of $85.2 million. Ms. Riel noted that the Company focuses more on growth of average balances year over year since that measure relates more directly to income statement results. As compared to the fourth quarter of 2019, average loan growth in the first quarter 2020 was 1.6% and average deposits declined by 0.4%. Deposit growth tends to be seasonally lower in the first quarter of each year. The efficiency ratio, which measures the ratio of noninterest expense to total revenue, for the first quarter of 2020 was 43.83% as compared to 43.87% for the first quarter of 2019.”

The company had legal fees of $4.6 million last quarter. I think our thesis holds that this is a good bank that’s held back by legal fees. Once that matter clears, EGBN should get a much better valuation.

Posted by on April 22nd, 2020 at 4:55 pm


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