United Community Banks (NYSE:UCB) Issues Earnings Results, Misses Expectations By $0.09 EPS

United Community Banks (NYSE:UCB) posted its quarterly earnings results on Tuesday. The company reported $0.71 EPS for the quarter, missing the consensus estimate of $0.80 by ($0.09), Zacks reports. United Community Banks had a net margin of 22.05% and a return on equity of 9.65%.

Here are the key takeaways from United Community Banks’ conference call:

• United Community Banks posted a solid quarter, with operating EPS of $0.71 up 8% year over year and total revenue up 7%. Management also highlighted a sixth straight quarter of net interest margin expansion to 3.68%.
• Loan growth accelerated to a 6.8% annualized pace, or 6.4% excluding Navitas, driven by stronger hiring of revenue producers. Executives said the new lending team additions are starting to show up in production and could support upper-single-digit growth next year.
• Credit quality remained strong, with bank-only net charge-offs of 9 basis points and total net charge-offs of 16 basis points. Past dues and criticized loan metrics were also described as being at very low levels.
• The quarter included a large non-operating benefit from releasing Navitas reserves as those loans were reclassified to held for sale, along with a one-time California lender license settlement cost tied to Navitas. Management said the Navitas sale is still expected to close early in the third quarter.
• Management reiterated a strong capital return and M&A optionality outlook, including buying back the remaining shares tied to Peach State and considering additional capital deployment next year. They also said small-bank acquisition conversations remain active and could increase after Peach State closes.

United Community Banks Price Performance

UCB traded down $0.82 on Tuesday, reaching $35.21. The company had a trading volume of 67,899 shares, compared to its average volume of 909,431. The company has a fifty day moving average of $34.04 and a 200-day moving average of $33.39. The company has a market capitalization of $4.21 billion, a P/E ratio of 12.92 and a beta of 0.81. The company has a current ratio of 0.82, a quick ratio of 0.82 and a debt-to-equity ratio of 0.03. United Community Banks has a one year low of $28.65 and a one year high of $37.18.

United Community Banks Dividend Announcement

The company also recently disclosed a quarterly dividend, which was paid on Friday, July 3rd. Investors of record on Monday, June 15th were issued a $0.25 dividend. This represents a $1.00 dividend on an annualized basis and a dividend yield of 2.8%. The ex-dividend date of this dividend was Monday, June 15th. United Community Banks’s dividend payout ratio (DPR) is 36.76%.

Analyst Upgrades and Downgrades

UCB has been the topic of a number of recent research reports. Weiss Ratings upgraded United Community Banks from a “buy (b-)” rating to a “buy (b)” rating in a research report on Tuesday, June 30th. Keefe, Bruyette & Woods upgraded United Community Banks from a “market perform” rating to an “outperform” rating and upped their target price for the stock from $36.00 to $40.00 in a research note on Thursday, April 9th. Hovde Group decreased their price target on United Community Banks from $38.00 to $37.00 and set a “market perform” rating for the company in a report on Monday, April 27th. TD Cowen upgraded shares of United Community Banks to a “strong-buy” rating in a research report on Thursday, July 16th. Finally, Piper Sandler cut their price target on United Community Banks from $36.00 to $35.00 and set a “neutral” rating for the company in a research note on Wednesday, June 17th. One investment analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and three have given a Hold rating to the stock. According to data from MarketBeat, United Community Banks currently has an average rating of “Moderate Buy” and a consensus price target of $38.40.

Insider Buying and Selling at United Community Banks

In related news, EVP Richard Bradshaw sold 1,510 shares of the company’s stock in a transaction that occurred on Monday, April 27th. The shares were sold at an average price of $33.09, for a total value of $49,965.90. Following the completion of the sale, the executive vice president owned 84,497 shares in the company, valued at approximately $2,796,005.73. This represents a 1.76% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. 0.45% of the stock is currently owned by company insiders.

Institutional Trading of United Community Banks

Several large investors have recently modified their holdings of the company. Royal Bank of Canada increased its position in shares of United Community Banks by 7.0% during the first quarter. Royal Bank of Canada now owns 55,319 shares of the company’s stock valued at $1,557,000 after purchasing an additional 3,617 shares during the period. AQR Capital Management LLC lifted its stake in United Community Banks by 176.2% in the 1st quarter. AQR Capital Management LLC now owns 26,530 shares of the company’s stock valued at $746,000 after acquiring an additional 16,925 shares in the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. boosted its holdings in shares of United Community Banks by 4.6% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 71,211 shares of the company’s stock valued at $2,003,000 after buying an additional 3,115 shares during the last quarter. Dynamic Technology Lab Private Ltd acquired a new position in United Community Banks in the 1st quarter valued at about $219,000. Finally, United Services Automobile Association bought a new position in shares of United Community Banks during the first quarter worth approximately $204,000. 82.29% of the stock is owned by institutional investors.

About United Community Banks

United Community Banks, Inc (NYSE: UCB) is a bank holding company headquartered in Blairsville, Georgia. It operates primarily through its subsidiary, United Community Bank, providing a broad range of banking and financial services to individual, business and governmental customers. The company’s core offerings include deposit accounts, commercial and consumer lending, mortgage origination, treasury and cash management services, and wealth management.

In addition to traditional banking products such as checking, savings and money market accounts, United Community Bank specializes in commercial real estate financing, small business administration (SBA) loans, equipment financing and agricultural lending.