Webster Financial Corporation (NYSE:WBS) Receives Consensus Recommendation of "Moderate Buy" from Analysts

Key Points

• Webster Financial Corporation has received a consensus rating of "Moderate Buy" from analysts, with ten out of thirteen recommending buying the stock and a 12-month price target averaging $66.77.
• Insider activity shows that executives sold significant amounts of stock recently, with total insider sales reaching 40,838 shares valued at over $2.3 million in the last quarter.
• The company announced a quarterly dividend of $0.40 per share, reflecting a dividend yield of 2.9%, and initiated a $700 million share repurchase plan indicating potential undervaluation of stock.

Webster Financial Corporation (NYSE:WBS - Get Free Report) has earned a consensus rating of "Moderate Buy" from the thirteen brokerages that are presently covering the firm, Marketbeat reports. Three equities research analysts have rated the stock with a hold recommendation and ten have issued a buy recommendation on the company. The average 1 year target price among analysts that have issued ratings on the stock in the last year is $66.7692.

Several equities analysts have recently weighed in on WBS shares. Wells Fargo & Company lifted their price objective on Webster Financial from $70.00 to $75.00 and gave the company an "overweight" rating in a research note on Friday, July 18th. UBS Group restated a "buy" rating and set a $69.00 price objective on shares of Webster Financial in a report on Wednesday, July 9th. Citigroup boosted their price target on Webster Financial from $65.00 to $71.00 and gave the company a "buy" rating in a report on Friday, July 18th. JPMorgan Chase & Co. boosted their price target on Webster Financial from $55.00 to $65.00 and gave the company an "overweight" rating in a report on Tuesday, July 1st. Finally, Raymond James Financial boosted their price target on Webster Financial from $65.00 to $68.00 and gave the company an "outperform" rating in a report on Friday, July 18th.

Webster Financial Price Performance

Shares of WBS stock traded down $0.14 during mid-day trading on Friday, reaching $56.48. The stock had a trading volume of 360,328 shares, compared to its average volume of 1,315,573. Webster Financial has a 12-month low of $39.43 and a 12-month high of $63.99. The company has a market cap of $9.50 billion, a P/E ratio of 11.45, a price-to-earnings-growth ratio of 0.51 and a beta of 1.04. The business has a 50-day simple moving average of $55.86 and a 200 day simple moving average of $53.43. The company has a current ratio of 0.86, a quick ratio of 0.85 and a debt-to-equity ratio of 0.47.

Webster Financial (NYSE:WBS - Get Free Report) last posted its quarterly earnings data on Thursday, July 17th. The financial services provider reported $1.52 EPS for the quarter, topping analysts' consensus estimates of $1.43 by $0.09. Webster Financial had a return on equity of 10.84% and a net margin of 20.06%. The firm had revenue of $715.80 million during the quarter, compared to analysts' expectations of $716.59 million. During the same quarter last year, the business posted $1.26 EPS. The firm's quarterly revenue was up 16.5% compared to the same quarter last year. On average, sell-side analysts anticipate that Webster Financial will post 5.88 earnings per share for the current year.

Webster Financial Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, August 21st. Stockholders of record on Monday, August 11th will be issued a $0.40 dividend. The ex-dividend date is Monday, August 11th. This represents a $1.60 annualized dividend and a dividend yield of 2.8%. Webster Financial's dividend payout ratio is 32.45%.

Webster Financial announced that its Board of Directors has authorized a stock buyback plan on Thursday, May 1st that permits the company to repurchase $700.00 million in shares. This repurchase authorization permits the financial services provider to reacquire up to 8.7% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company's leadership believes its stock is undervalued.

Insiders Place Their Bets

In other news, insider Charles L. Wilkins sold 5,000 shares of the business's stock in a transaction on Friday, June 6th. The stock was sold at an average price of $53.25, for a total transaction of $266,250.00. Following the sale, the insider directly owned 31,534 shares of the company's stock, valued at $1,679,185.50. The trade was a 13.69% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, CAO Albert Jen-Wen Wang sold 3,250 shares of the business's stock in a transaction on Tuesday, July 22nd. The stock was sold at an average price of $60.31, for a total value of $196,007.50. Following the sale, the chief accounting officer directly owned 15,755 shares in the company, valued at $950,184.05. This trade represents a 17.10% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last 90 days, insiders have sold 39,638 shares of company stock valued at $2,258,145. 0.54% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Several large investors have recently bought and sold shares of the business. FMR LLC increased its position in Webster Financial by 1.2% in the 4th quarter. FMR LLC now owns 8,493,426 shares of the financial services provider's stock worth $469,007,000 after purchasing an additional 99,908 shares during the last quarter. Dimensional Fund Advisors LP boosted its stake in Webster Financial by 7.4% during the 1st quarter. Dimensional Fund Advisors LP now owns 7,108,082 shares of the financial services provider's stock valued at $366,408,000 after purchasing an additional 487,264 shares during the period. Invesco Ltd. boosted its stake in Webster Financial by 3.1% during the 1st quarter. Invesco Ltd. now owns 5,049,297 shares of the financial services provider's stock valued at $260,291,000 after purchasing an additional 153,236 shares during the period. Price T Rowe Associates Inc. MD boosted its stake in Webster Financial by 0.9% during the 1st quarter. Price T Rowe Associates Inc. MD now owns 4,597,943 shares of the financial services provider's stock valued at $237,025,000 after purchasing an additional 42,406 shares during the period. Finally, Capital International Investors raised its holdings in Webster Financial by 0.9% in the 4th quarter. Capital International Investors now owns 4,130,379 shares of the financial services provider's stock valued at $228,000,000 after acquiring an additional 35,039 shares in the last quarter. 85.58% of the stock is owned by institutional investors and hedge funds.

Webster Financial Company Profile

Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides a range of financial products and services to individuals, families, and businesses in the United States. It operates through three segments: Commercial Banking, HSA Bank, and Consumer Banking.