NewtekOne Inc Reports Strong Financial Results for Q2 2024
Intellectia.AI2024-08-08
NewtekOne, Inc. Reports Strong Financial Results for Q2 2024
BOCA RATON, Fla., Aug. 05, 2024 — NewtekOne, Inc. (NASDAQ:NEWT) reported its financial results for the quarter ending June 30, 2024, demonstrating significant loan and deposit growth while maintaining its annual EPS forecast for 2024.
Key Financial Metrics
| Metric | Q2 2024 | Q1 2024 | Q2 2023 | YoY Change (%) | QoQ Change (%) |
|---|---|---|---|---|---|
| Net Income ($ millions) | 10.9 | 9.7 | 7.0 | 55.7% | 12.4% |
| EPS (Basic and Diluted, $) | 0.43 | 0.38 | 0.27 | 59.3% | 13.2% |
| Net Interest Income ($ millions) | 9.1 | 8.9 | 5.7 | 59.6% | 2.2% |
| Total Assets ($ billions) | 1.6 | - | - | - | - |
| ROTCE (%) | 21.1 | 20.6 | 15.4 | 37.0% | 2.4% |
| ROAA (%) | 2.8 | 2.8 | 2.1 | 33.3% | 0.0% |
| Net Interest Margin (%) | 2.70 | 2.92 | 2.01 | 34.3% | -7.5% |
| Efficiency Ratio (%) | 66.3 | 70.6 | 75.6 | -12.3% | -6.1% |
Interpretation: NewtekOne, Inc. showed a robust improvement in profitability with year-over-year EPS growth of 59.3%. The company also increased its net income by 12.4% over the prior quarter, indicating solid financial performance despite challenging economic conditions.
Revenue Performance by Segment
| Segment | Q2 2024 Revenue ($ millions) | Q1 2024 Revenue ($ millions) | Q2 2023 Revenue ($ millions) | YoY Change (%) | QoQ Change (%) |
|---|---|---|---|---|---|
| SBA 7(a) Loans | 229.8 | - | 194.7 | 18.06% | - |
| SBA 504 Loans | 16.4 | - | 15.8 | 3.94% | - |
| Total Loan Closings | 316.5 | - | 250.5 | 26.33% | - |
Interpretation: NewtekOne, Inc. experienced notable growth in all major lending segments, driven primarily by SBA 7(a) loans, which saw an 18.06% year-over-year increase and a total loan closing growth of 26.33%.
Dividend and Share Repurchase Program
- Dividend: On July 19, 2024, the company paid a quarterly cash dividend of $0.19 per share on its outstanding common shares.
Forward Guidance
- EPS Guidance: The company maintains its 2024 annual EPS forecast in the range of $1.85 to $2.05 per basic and diluted common share.
Stock Price Movement
- Post-Event Stock Change: Following the earnings release, NewtekOne's stock experienced a decline of 4.4%.
Executive Commentary
Barry Sloane, Chairman, President, and Chief Executive Officer, stated, "We are pleased to report EPS of $0.43 per basic and diluted common share for the second quarter of 2024. Despite higher short-term interest rates and other market challenges, we continue to meet and exceed our expectations, establishing ourselves as a differentiated and new model for financial holding companies."
Overall, NewtekOne, Inc. delivered solid results for Q2 2024, demonstrating strong financial and operational performance across its major business segments, while providing optimistic forward guidance.
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