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Provident Financial Services (PFS)
NYSE:PFS
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Provident Financial Services
(NYSE:PFS)
73Outperform
Provident Financial Services (PFS) vs. S&P 500 (SPY)
Market Cap
$2.29B
Dividend Yield5.49%
Average Volume (3M)747.60K
Price to Earnings (P/E)15.8
Beta (1Y)0.97
Revenue Growth80.23%
EPS Growth-30.60%
CountryUS
Employees1,753
SectorFinancial
Sector Strength85
IndustryBanks - Regional
Share Statistics
EPS (TTM)0.50
Shares Outstanding130,659,940
10 Day Avg. Volume547,566
30 Day Avg. Volume747,598
Financial Highlights & Ratios
PEG Ratio2.65
Price to Book (P/B)0.84
Price to Sales (P/S)0.00
P/FCF Ratio5.26
Enterprise Value/Market Cap0.87
Enterprise Value/Revenue0.85
Enterprise Value/Gross Profit2.48
Enterprise Value/Ebitda1.64
Forecast
1Y Price Target
$21.50Price Target Upside22.86% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Provident Financial Services Business Overview & Revenue Model
Company DescriptionProvident Financial Services, Inc. operates as the bank holding company for Provident Bank that provides various banking products and services to individuals, families, and businesses in the United States. The company's deposit products include savings, checking, interest-bearing checking, money market deposit, and certificate of deposit accounts, as well as IRA products. Its loan portfolio comprises commercial real estate loans that are secured by properties, such as multi-family apartment buildings, office buildings, and retail and industrial properties; commercial business loans; fixed-rate and adjustable-rate mortgage loans collateralized by one- to four-family residential real estate properties; commercial construction loans; and consumer loans consisting of home equity loans, home equity lines of credit, marine loans, personal loans and unsecured lines of credit, and auto and recreational vehicle loans. The company also offers cash management, remote deposit capture, payroll origination, escrow account management, and online and mobile banking services; and business credit cards. In addition, it provides wealth management services comprising investment management, trust and estate administration, financial planning, tax compliance and planning, and private banking. Further, the company sells insurance and investment products, including annuities; operates as a real estate investment trust for acquiring mortgage loans and other real estate related assets; and manages and sells real estate properties acquired through foreclosure. As of December 31, 2021, it operated 96 full-service branch offices in northern and central New Jersey, as well as in Pennsylvania and New York counties. The company was founded in 1839 and is headquartered in Jersey City, New Jersey.
How the Company Makes MoneyProvident Financial Services makes money primarily through interest income generated from its lending activities, which include residential, commercial, and consumer loans. The company also earns revenue from fees associated with deposit accounts, loan servicing, and other banking services. Additionally, Provident Financial Services benefits from investment income through its securities portfolio. The company's earnings are also supported by non-interest income, which includes fees from wealth management services and various banking fees. Key factors contributing to its revenue include maintaining a strong net interest margin, effective risk management practices, and strategic growth initiatives within its market areas.
Provident Financial Services Financial Statement Overview
Summary
Provident Financial Services demonstrates sound financial health with strong profitability and a robust balance sheet. Revenue growth is positive, though net margins face pressure. Cash flow generation is strong, but volatility in free cash flow and large financing activities need monitoring. The company is well-positioned but must maintain profitability amidst competitive pressures.Income Statement
The company shows strong gross profit margins consistently above 80%, indicating efficient cost management. Revenue growth is solid, particularly noticeable in 2024, but net profit margins have declined slightly, suggesting rising costs or competitive pressures. EBIT margins remain robust, reflecting operational efficiency.75
Positive
Balance Sheet
The balance sheet is strong with no debt in 2024, significantly improving the debt-to-equity ratio to 0. Stockholders' equity has increased, enhancing the equity ratio, while Return on Equity remains stable, indicating consistent profitability. These factors contribute to a solid financial foundation.82
Very Positive
Cash Flow
Operating cash flow is positive and growing, indicating good cash generation from core activities. However, free cash flow growth has been volatile, and the high financing outflow in 2024 could be a concern. The operating cash flow to net income ratio suggests efficient cash conversion, but the free cash flow to net income ratio highlights potential cash flow management issues.70
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.05B | 451.38M | 505.34M | 452.83M | 385.00M | Gross Profit |
| 694.73M | 403.98M | 462.31M | 414.22M | 348.81M | EBIT |
| 1.04B | 242.80M | 288.74M | 227.12M | 127.55M | EBITDA |
| 0.00 | 0.00 | 417.96M | 359.78M | 322.71M | Net Income Common Stockholders |
| 115.53M | 128.40M | 175.65M | 167.92M | 96.95M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 205.94M | 180.19M | 1.99B | 2.77B | 1.64B | Total Assets |
| 24.05B | 14.21B | 13.78B | 13.78B | 12.92B | Total Debt |
| 2.31B | 1.46B | 1.35B | 637.06M | 1.20B | Net Debt |
| 2.10B | 1.28B | 1.16B | -75.41M | 668.75M | Total Liabilities |
| 21.45B | 12.52B | 12.19B | 637.06M | 1.20B | Stockholders Equity |
| 2.60B | 1.69B | 1.60B | 1.70B | 1.62B |
| Cash Flow | Free Cash Flow | |||
| 425.07M | 165.91M | 190.90M | 144.38M | 94.09M | Operating Cash Flow |
| 426.38M | 173.40M | 200.31M | 158.18M | 106.91M | Investing Cash Flow |
| 507.67M | -469.60M | -647.56M | -717.94M | -507.98M | Financing Cash Flow |
| -908.37M | 289.95M | -78.70M | 739.86M | 746.68M |
Provident Financial Services Technical Analysis
Positive
17.50
Price Trends
16.40
Positive
17.33
Positive
17.89
Negative
Market Momentum
0.38
Negative
61.22
Neutral
58.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PFS, the sentiment is Positive. The current price of 17.5 is above the 20-day moving average (MA) of 16.70, above the 50-day MA of 16.40, and below the 200-day MA of 17.89, indicating a neutral trend. The MACD of 0.38 indicates Negative momentum. The RSI at 61.22 is Neutral, neither overbought nor oversold. The STOCH value of 58.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PFS.
Provident Financial Services Risk Analysis
Provident Financial Services disclosed 30 risk factors in its most recent earnings report. Provident Financial Services reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Provident Financial Services Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $2.29B | 15.78 | 6.77% | 5.49% | 80.23% | -30.60% | |
71 Outperform | $3.41B | 11.18 | 7.83% | 2.45% | 13.04% | 31.39% | |
71 Outperform | $2.40B | 11.34 | 7.70% | 3.51% | 24.53% | 0.16% | |
68 Neutral | $2.24B | 12.73 | 10.09% | 2.96% | 10.06% | 6.18% | |
65 Neutral | $2.22B | 17.40 | 5.82% | 2.79% | 4.52% | 7.58% | |
65 Neutral | $2.10B | 16.83 | 8.27% | 1.53% | 3.30% | 14.32% | |
64 Neutral | $12.82B | 9.83 | 7.68% | 17000.34% | 12.38% | -5.56% |
* Financial Sector Average
Performance Comparison
PFS
Provident Financial Services
17.50
2.64
17.77%
BANR
Banner
64.79
20.19
45.27%
RNST
Renasant
35.86
5.95
19.89%
SBCF
Seacoast Banking Of Florida
25.84
2.46
10.52%
WAFD
Washington Federal
29.70
1.93
6.95%
FBK
FB Financial
45.67
7.73
20.37%
Provident Financial Services Earnings Call Summary
Earnings Call Date:Apr 24, 2025
(Q1-2025)
| % Change Since: 5.11%|
Next Earnings Date:Jul 25, 2025
Earnings Call Sentiment Positive
The call highlighted strong financial performance, improved margins, and a robust loan pipeline. However, there were concerns with deposit declines and an increase in nonperforming loans. The positive aspects slightly outweigh the negatives, indicating a generally favorable outlook with some areas to monitor.Q1-2025 Updates
Positive Updates
Strong Financial Performance
Provident reported net earnings of $64 million or $0.49 per share, with an annualized adjusted return on average assets of 1.11% and an adjusted return on average tangible equity of 16.15%.
Increased Lending and Strong Pipeline
The commercial lending team closed approximately $600 million in new loans, with a 3.8% increase in the commercial loan portfolio. The total loan pipeline increased to approximately $2.8 billion.
Improved Margins
The net interest margin increased 6 basis points to 3.34%, and the core net interest margin grew 9 basis points.
Tangible Book Value Growth
Tangible book value per share grew $0.69 to $14.15, and the tangible common equity ratio expanded to 7.9%.
Fee-Based Business Growth
Provident Protection Plus achieved a 19% organic growth in new business, with income up 23% compared to the previous year.
Negative Updates
Deposit Decline
Deposits declined by $175 million or 0.94%, primarily due to seasonal outflow of municipal deposits.
Nonperforming Loan Increase
The nonperforming loan ratio increased to 0.54% due to two well-secured loans with no prior charge-off history.
Beacon Trust Fee Income Decrease
Beacon Trust assets under management and fee income decreased by approximately 4% due to market conditions.
Company Guidance
During the Provident Financial Services, Inc. First Quarter 2025 Earnings Conference Call, guidance for the year was discussed, highlighting several key financial metrics. The company reported net earnings of $64 million or $0.49 per share, with an impressive annualized adjusted return on average assets of 1.11% and an adjusted return on average tangible equity of 16.15%. The adjusted pretax pre-provision return on average assets was 1.61%. Provident's tangible book value per share increased by $0.69 to $14.15, and the tangible common equity ratio expanded to 7.9%. Despite a $175 million decline in deposits due to seasonal outflows, the average cost of total deposits decreased by 14 basis points to 2.11%, and the total cost of funds decreased to 2.39%. The net interest margin increased by 6 basis points to 3.34%, and the commercial loan portfolio grew by 3.8%. The pipeline of loans was substantial, at approximately $2.8 billion, with a weighted average interest rate of 6.31%. The company maintained strong credit quality, even as the nonperforming loan ratio increased to 0.54%. Provident's fee-based businesses, including Provident Protection Plus, showed strong performance, with a 19% organic growth in new business. The company projects a return on average assets of approximately 1.15% and a return on tangible equity of about 16% for 2025.Provident Financial Services Corporate Events
DividendsBusiness Operations and StrategyFinancial Disclosures
Provident Financial Announces Dividend Amid Strong Q1 Results
Positive
Apr 25, 2025
On April 24, 2025, Provident Financial Services, Inc. announced a quarterly cash dividend of $0.24 per common share, payable on May 30, 2025. The company reported a net income of $64.0 million for the first quarter of 2025, showing an increase from previous quarters. The results were positively influenced by the integration of Lakeland Bancorp, Inc., and despite a write-down on a foreclosed property, the company saw improvements in net interest margin and a decrease in credit loss provisions. The company’s commercial and industrial loan portfolio grew, and insurance agency income saw a significant increase, indicating strong operational performance and strategic positioning in the market.
Spark’s Take on PFS Stock
According to Spark, TipRanks’ AI Analyst, PFS is a Outperform.
Provident Financial Services demonstrates strong financial health, marked by positive earnings call outcomes and strategic corporate events. While technical indicators suggest caution, the reasonable valuation and high dividend yield offer an attractive income opportunity. The main risk factors are maintaining profitability amidst competitive pressures and managing cash flow volatility.
To see Spark’s full report on PFS stock, click here.
Financial Disclosures
Provident Financial Services Reports Strong Q1 2025 Results
Positive
Apr 24, 2025
Provident Financial Services reported its financial results for the first quarter of 2025, showing an increase in net interest margin and improved efficiency ratios. The company experienced a significant decrease in the provision for credit losses due to changes in unemployment rate forecasts, and its insurance agency income rose by 17.9% compared to the previous year. The loan pipeline remains robust, with a total of $2.77 billion in loans pending closing, reflecting a stable core funding base and diversified loan portfolio.
Spark’s Take on PFS Stock
According to Spark, TipRanks’ AI Analyst, PFS is a Neutral.
Provident Financial Services exhibits strong financial health and profitability, supported by a robust balance sheet and positive earnings call outcomes. However, technical indicators are currently bearish, and there are challenges in sustaining noninterest income and loan growth. The valuation is reasonable, and the high dividend yield provides an attractive income opportunity. The stock’s performance will largely depend on its ability to overcome competitive pressures and maintain its financial momentum.
To see Spark’s full report on PFS stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.