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Berkshire Hills Bancorp (BHLB)
NYSE:BHLB
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Berkshire Hills
(NYSE:BHLB)
63Neutral
Berkshire Hills (BHLB) vs. S&P 500 (SPY)
Market Cap
$1.07B
Dividend Yield2.81%
Average Volume (3M)650.47K
Price to Earnings (P/E)16.2
Beta (1Y)0.93
Revenue Growth17.98%
EPS Growth399.48%
CountryUS
Employees1,193
SectorFinancial
Sector Strength88
IndustryBanks - Regional
Share Statistics
EPS (TTM)0.60
Shares Outstanding46,378,258
10 Day Avg. Volume712,955
30 Day Avg. Volume650,470
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.22
Price to Cash Flow (P/CF)8.30
P/FCF Ratio0.00
Enterprise Value/Market Cap1.43
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit3.50
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$30.98Price Target Upside20.97% Upside
Rating ConsensusHold
Number of Analyst Covering2
Berkshire Hills Business Overview & Revenue Model
Company DescriptionBerkshire Hills Bancorp, Inc. operates as the bank holding company for Berkshire Bank that provides various banking products and services. It offers various deposit accounts, including demand deposit, NOW, regular savings, money market savings, time certificates of deposit, and retirement deposit accounts; and loans, such as commercial real estate, commercial and industrial, consumer, and residential mortgage loans. The company also provides wealth management services comprising investment management, trust administration, and financial planning; and investment products, financial planning, and brokerage services. In addition, it offers electronic banking, commercial cash management, online banking, small business banking, asset based lending, and mobile banking services; and debit cards and other electronic fee producing payment services to transaction account customers. The company serves personal, commercial, non-profit, and municipal deposit customers. As of March 14, 2022, it operated 106 full-service branches in Massachusetts, New York, Connecticut, and Vermont. The company also has commercial banking offices in Providence, Rhode Island and New Haven, Connecticut. Berkshire Hills Bancorp, Inc. was founded in 1846 and is headquartered in Boston, Massachusetts.
How the Company Makes MoneyBerkshire Hills Bancorp makes money primarily through its subsidiary, Berkshire Bank, which earns revenue from interest income and non-interest income sources. Interest income is generated mainly from loans and investment securities, with the bank earning interest on loans provided to individuals and businesses. Non-interest income comes from fees and services, including wealth management, insurance services, and transaction fees. The bank also earns from service charges on deposit accounts, ATM fees, and other banking-related fees. Additionally, strategic partnerships and community engagement initiatives enhance its service offerings and customer base, contributing to its earnings.
Berkshire Hills Financial Statement Overview
Summary
Berkshire Hills has demonstrated robust revenue growth and operational efficiency improvements, as reflected by the income statement. The balance sheet shows reduced financial leverage and a solid equity base, but liquidity concerns persist due to decreased cash. Cash flow issues arise from a significant drop in operating cash flow, indicating potential cash management challenges.Income Statement
Berkshire Hills has shown a steady increase in total revenue over the years, with a significant jump from 2022 to 2023. The gross profit margin has improved from prior years, indicating enhanced efficiency in operations. However, the net profit margin has declined from 2023 to 2024 due to a decrease in net income, which may signal rising costs or operational challenges. EBIT and EBITDA margins show improvement, suggesting operational strength despite net income fluctuations.65
Positive
Balance Sheet
The balance sheet of Berkshire Hills reflects a solid equity base with an increasing trend in stockholders' equity, demonstrating growing investor confidence. The debt-to-equity ratio has significantly improved due to the reduction of total debt, indicating reduced financial leverage and risk. The equity ratio remains stable, ensuring a strong financial structure. However, the decrease in cash and cash equivalents could impact liquidity.70
Positive
Cash Flow
Berkshire Hills experienced a significant drop in operating cash flow in 2024 compared to 2023, indicating potential challenges in cash generation from core activities. While free cash flow in 2023 was robust, its absence in 2024 is concerning and suggests difficulties in sustaining capital expenditures without external financing. The lack of reported free cash flow and operating cash flow in the latest year raises red flags about cash management.55
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 613.94M | 576.30M | 413.53M | 381.47M | 381.85M | Gross Profit |
| 438.58M | 322.94M | 171.76M | 134.22M | 381.85M | EBIT |
| 434.06M | 317.57M | 156.48M | 149.02M | -552.87M | EBITDA |
| 434.06M | 0.00 | -513.17M | 118.66M | -514.93M | Net Income Common Stockholders |
| 61.00M | 69.60M | 92.53M | 118.66M | -513.17M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.13B | 1.20B | 2.11B | 3.51B | 3.25B | Total Assets |
| 12.27B | 12.43B | 11.66B | 11.55B | 12.84B | Total Debt |
| 103.50M | 568.29M | 125.51M | 110.84M | 571.64M | Net Debt |
| -79.28M | -634.95M | -19.83M | 1.49M | 480.42M | Total Liabilities |
| 11.11B | 11.42B | 10.71B | 10.37B | 11.65B | Stockholders Equity |
| 1.17B | 1.01B | 954.06M | 1.18B | 1.19B |
| Cash Flow | Free Cash Flow | |||
| 120.64M | 153.26M | 121.74M | 103.87M | 220.43M | Operating Cash Flow |
| 125.21M | 155.08M | 123.23M | 105.48M | 227.64M | Investing Cash Flow |
| 8.06M | -282.39M | -1.27B | 600.55M | 641.10M | Financing Cash Flow |
| 117.21M | 645.19M | 207.69M | -636.10M | 109.30M |
Berkshire Hills Technical Analysis
Neutral
25.61
Price Trends
25.64
Negative
27.22
Negative
27.22
Negative
Market Momentum
-0.10
Negative
57.29
Neutral
89.97
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BHLB, the sentiment is Neutral. The current price of 25.61 is above the 20-day moving average (MA) of 24.06, below the 50-day MA of 25.64, and below the 200-day MA of 27.22, indicating a neutral trend. The MACD of -0.10 indicates Negative momentum. The RSI at 57.29 is Neutral, neither overbought nor oversold. The STOCH value of 89.97 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BHLB.
Berkshire Hills Risk Analysis
Berkshire Hills disclosed 44 risk factors in its most recent earnings report. Berkshire Hills 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
Berkshire Hills 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 | $1.22B | 9.81 | 11.08% | 1.40% | 7.68% | -1.13% | |
72 Outperform | $1.38B | 7.03 | 16.20% | 5.39% | 16.62% | 23.05% | |
71 Outperform | $1.12B | 9.98 | 11.70% | 0.36% | 4.17% | -0.91% | |
70 Outperform | $1.16B | 41.48 | 2.47% | 3.75% | -2.81% | -64.23% | |
66 Neutral | $1.24B | 20.98 | 6.10% | 0.44% | 12.30% | -41.81% | |
64 Neutral | $12.64B | 9.74 | 8.05% | 17044.60% | 12.66% | -4.62% | |
63 Neutral | $1.07B | 16.23 | 9.69% | 2.81% | 17.98% | 399.48% |
* Financial Sector Average
Performance Comparison
BHLB
Berkshire Hills
25.61
3.71
16.94%
BLX
Banco Latinoamericano De Comercio
39.41
9.90
33.55%
DCOM
Dime Community Bancshares
26.65
7.62
40.04%
QCRH
QCR Holdings
66.37
8.63
14.95%
LOB
Live Oak Bancshares
27.28
-8.06
-22.81%
BY
Byline Bancorp
26.43
3.39
14.71%
Berkshire Hills Earnings Call Summary
Earnings Call Date:Apr 24, 2025
(Q1-2025)
| % Change Since: 5.39%|
Next Earnings Date:Jul 16, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance with significant improvements in net income, operating leverage, and asset quality. The successful digital deposit initiative and strategic merger plans further contributed to the positive outlook. However, concerns about declining noninterest income and uncertainty in the economic environment were noted. Overall, the positive highlights outweigh the lowlights.Q1-2025 Updates
Positive Updates
Strong Operating Net Income Growth
Operating net income for the quarter was $27.6 million, up 6% linked quarter and 32% year over year.
Positive Operating Leverage
Positive operating leverage of 5% linked quarter and 11% year over year due to improved revenues and declining expenses.
Asset Quality Metrics
Total delinquencies and nonperforming loans were at 42 basis points of loans, the lowest level in about twenty years.
Digital Deposit Initiative Success
The digital deposit initiative gained momentum, delivering approximately $75 million in new deposits.
Merger with Brookline Bancorp
The merger of equals with Brookline Bancorp is expected to improve scale and profitability, with an estimated 23% accretion to Berkshire's 2026 consensus estimate.
Improved Net Interest Margin
Net interest margin was 3.24%, up 10 basis points linked quarter.
Operating Expenses Reduction
Operating expenses were down $3.1 million or 4% linked quarter and $4.5 million or 6% year over year.
Recognition as a Trustworthy Bank
Berkshire Hills Bancorp was recognized as one of the most trustworthy banks in America by Newsweek for the fourth consecutive year.
Negative Updates
Noninterest Income Decline
Operating noninterest income was down $2.5 million or 11% linked quarter, primarily due to lower SBA gains and BOLI income.
Uncertain Economic Environment
The economic environment remains volatile, impacted by tariffs and other policy initiatives, creating uncertainty in loan demand.
Slight Decline in Operating ROTCE
Operating ROTCE was down 27 basis points linked quarter.
Loan Demand Slowdown
The pipeline for loan demand has slowed down compared to the previous quarter, indicating a potential economic slowdown.
Company Guidance
During the Berkshire Hills Bancorp First Quarter 2025 Earnings Conference Call, the company reported robust financial metrics, highlighting an operating net income of $27.6 million, which marked a 6% increase quarter-over-quarter and a 32% increase year-over-year. The earnings per share remained stable at $0.60 compared to the fourth quarter but showed a 22% rise year-over-year. The operating expenses were reduced to $68 million, reflecting a 4% decrease from the prior quarter and a 6% decline year-over-year, thereby resulting in a positive operating leverage of 5% quarter-over-quarter and 11% year-over-year. The operating ROTCE was reported at 9.66%, which was a decline of 27 basis points quarter-over-quarter but an increase of 93 basis points year-over-year. Asset quality metrics were strong, with net charge-offs at 15 basis points of loans, and the reserve to loans ratio increased by 2 basis points to 1.24%. Additionally, total delinquencies and nonperforming loans were at 42 basis points of loans, the lowest in two decades. The loan-to-deposit ratio stood at 5%, illustrating a 1% decrease from the previous quarter. The company's strategic digital deposit initiative garnered $75 million in new deposits, and the nonstrategic runoff portfolios were reduced by 76% year-over-year to $34 million. The anticipated merger with Brookline Bancorp is expected to result in a 23% accretion to Berkshire's 2026 consensus estimate, and integration planning is underway.Berkshire Hills Corporate Events
Business Operations and StrategyFinancial Disclosures
Berkshire Hills Reports Strong Q1 2025 Financial Results
Positive
Apr 24, 2025
On April 24, 2025, Berkshire Hills Bancorp, Inc. reported strong financial results for the first quarter of 2025, showcasing a 22% increase in operating EPS year-over-year and a 5% rise in operating revenue. The company’s efficiency ratio improved to 59.5%, marking the best result in two years, while delinquent and non-performing loans were at their lowest in nearly two decades. CEO Nitin Mhatre highlighted the positive impact of strategic initiatives and the completion of the sale of the Upstart consumer loan portfolio. The company also concluded its Community Comeback program, exceeding its $5 billion goal in lending and investment, and was recognized by Newsweek as one of the most trusted companies in America.
Spark’s Take on BHLB Stock
According to Spark, TipRanks’ AI Analyst, BHLB is a Neutral.
Berkshire Hills’ strong financial fundamentals are overshadowed by challenges in cash flow and liquidity. The stock’s technical indicators suggest bearish trends, although its valuation is attractive. The earnings call provided positive guidance and strategic growth plans, but headwinds in net interest income and loan growth temper the outlook.
To see Spark’s full report on BHLB 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.