Citi raises Webster Financial stock price target to $71 on credit trends

Published 18/07/2025, 10:52
Citi raises Webster Financial stock price target to $71 on credit trends

Investing.com - Citi raised its price target on Webster Financial (NYSE:WBS) to $71.00 from $65.00 while maintaining a Buy rating on the stock. According to InvestingPro data, the stock has shown strong momentum with a 28% return over the past year, trading at a P/E ratio of 11.9x.

The firm cited stronger-than-expected second-quarter credit results as a key factor behind the $6 increase in its target price for the regional bank.

Citi noted that sentiment heading into earnings was positive for the first time in over a year, with investors anticipating improved credit trends in the second half of 2025.

The research firm believes Webster Financial’s stronger return on tangible common equity (ROTCE) compared to peers and its well-managed, interest rate sensitive balance sheet can continue to drive share price appreciation.

Citi also highlighted that Webster’s newly formed joint venture likely adds both incremental loan growth and fee income upside potential in 2026.

In other recent news, Webster Financial Corporation reported stronger-than-expected earnings for the second quarter of 2025. The company achieved an earnings per share (EPS) of $1.52, exceeding the forecast of $1.43. Additionally, Webster Financial’s revenues reached $715.8 million, slightly above the anticipated $715.12 million. The company has also authorized an additional $700 million in share repurchases, signaling confidence in its future performance. In a strategic move, Webster Financial launched a joint venture with Marathon Asset Management, aiming to enhance sponsor loan growth and fee revenue in the coming years. On the growth front, the company experienced a 1.2% increase in loans and a $739 million rise in deposits. These developments reflect Webster Financial’s solid operational efficiency and effective financial management. The firm also noted that its forward guidance remains optimistic, with expectations for full-year net interest income to range between $2.47 billion and $2.5 billion.

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