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Popular (BPOP) Shares Rise 7.4% Following Last Earnings Announcement: Will the Momentum Persist?

Popular (BPOP) Shares Rise 7.4% Following Last Earnings Announcement: Will the Momentum Persist?

101 finance101 finance2026/02/26 17:37
By:101 finance

Popular (BPOP) Stock Surges After Earnings Report

In the past month, Popular (BPOP) shares have climbed 7.4%, outpacing the S&P 500. Investors are now considering whether this momentum will persist as the next earnings announcement approaches, or if a correction is on the horizon. To better understand the current outlook, let's review the latest quarterly results and key performance factors.

Q4 2025 Results: Earnings and Revenue Highlights

For the fourth quarter of 2025, Popular reported adjusted earnings per share of $3.40, exceeding the Zacks Consensus Estimate of $3.02 and improving from $2.51 a year earlier. The company’s performance was bolstered by higher net interest income (NII), increased fee income, and growth in loan balances. However, these gains were partially offset by a decline in deposit balances, higher operating costs, and increased provisions.

Excluding the partial release of the FDIC special assessment reserve, net income under GAAP reached $233.9 million, marking a 31.5% increase year over year.

For the full year 2025, adjusted earnings per share totaled $12.18, surpassing the consensus estimate of $11.81 and representing a 35% rise from the prior year. GAAP net income for the year was $833.2 million, up 35.6% compared to 2024.

Revenue and Expense Trends

Quarterly revenues reached $823.8 million, up 9.1% from the same period last year and topping the consensus estimate of $814.9 million. For 2025, total revenues amounted to $3.2 billion, an 8.8% increase year over year, slightly above expectations.

  • Net interest income for the quarter was $657.6 million, up 11.3% from the previous year, with the net interest margin expanding to 3.61%.
  • Non-interest income edged up 1% to $166.3 million, mainly due to higher service charges, other fees, and gains on trading account debt securities.
  • Total operating expenses rose 1.2% to $473.2 million, driven by increased personnel costs, processing and transactional services, and business promotion expenses.

Loan and Deposit Developments

As of December 31, 2025, loans held in portfolio grew 1.6% sequentially to $38.5 billion. In contrast, total deposits declined slightly to $66.2 billion compared to the previous quarter.

Credit Quality Update

Popular set aside $71.4 million for credit losses in Q4 2025, a 3.3% increase from the prior year. Non-performing assets stood at $540.8 million, up 32.5% year over year, with the ratio of non-performing assets to total assets rising to 0.72% from 0.56% at the end of 2024.

Capital Position

At the close of 2025, the Common Equity Tier 1 capital ratio was 15.72%, and the Tier 1 capital ratio was 15.77%, both down from 16.03% and 16.08% a year earlier.

Share Buybacks

During the quarter, Popular repurchased 1.25 million shares of its common stock, totaling $147.8 million.

2026 Outlook

  • Total loans are projected to grow 3–4% over 2025, led by strong commercial lending.
  • Net interest income is expected to rise 5–7% year over year, supported by ongoing loan growth and reduced funding costs for Puerto Rico public deposits.
  • Non-interest income is anticipated to remain between $160 million and $165 million per quarter in 2026.
  • GAAP operating expenses are forecasted to increase about 3%, reflecting continued investments in staff and technology.
  • Net charge-offs are expected to range from 55 to 70 basis points, indicating steady credit trends and a stable economic environment.
  • The effective tax rate for 2026 is estimated at 15–17%.

Recent Estimate Revisions

Over the past month, analyst estimates for Popular have trended higher, with the consensus estimate rising by 7.79%.

VGM Score Overview

Currently, Popular holds a Growth Score of D, a Momentum Score of C, and a Value Score of B, placing it in the top 40% for value-focused strategies. The overall VGM Score is C, which may appeal to investors seeking a balanced approach rather than focusing on a single strategy.

Future Prospects

With upward estimate revisions and a Zacks Rank #2 (Buy), Popular is expected to deliver above-average returns in the coming months.

Industry Comparison: SouthState (SSB)

Popular is part of the Zacks Banks – Southeast industry. Another industry peer, SouthState (SSB), has seen its shares rise 1.5% over the past month. SouthState’s most recent quarterly report showed revenues of $686.87 million, a 52.5% increase year over year, and earnings per share of $2.47, up from $1.93 a year ago.

Looking ahead, SouthState is projected to earn $2.22 per share in the current quarter, a 3.3% year-over-year increase. The consensus estimate for SSB has edged up by 0.1% in the past 30 days. SouthState holds a Zacks Rank #3 (Hold) and a VGM Score of F.

Zacks Top 10 Stocks for 2026

There’s still time to access Zacks’ Top 10 Stocks for 2026, a portfolio curated by Director of Research Sheraz Mian. Since its inception in 2012 through November 2025, this selection has delivered a remarkable gain of +2,530.8%, far outpacing the S&P 500’s +570.3% return. The list features the top 10 stocks to buy and hold in 2026, chosen from over 4,400 companies covered by Zacks.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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