J.P. Morgan Maintains Neutral Rating On Webster Financial

According to J.P. Morgan, Webster Financial WBS reported run-rate EPS of $0.40 in 2Q, ahead of the $0.34 estimate and consensus of $0.35. J.P. Morgan said that the beat was on a combination of provision reported below forecast as well as core operating expenses also improving nicely q/q. “WBS shares trade at 1.5x TBV, or in line with peers. While we applaud the company for recognizing the need to streamline expense in a tough economic environment, with credit recovery baked into valuation at this point and top-line growth likely to remain under pressure (tied to sluggish loan growth, with average loans shrinking about 2% annualized in 2Q), we favor names better positioned to see top-line growth, such as SBNY, FRC and SIVB.” Webster Financial closed yesterday at $21.00.