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Regions Financial Corp. (RF)
NYSE:RF

Regions Financial (RF) AI Stock Analysis

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RF

Regions Financial

(NYSE:RF)

Rating:74Outperform
Price Target:
$24.00
â–²(7.33%Upside)
Regions Financial's overall stock score reflects its robust financial performance and attractive valuation, with stable technical indicators and positive corporate events. However, potential risks related to profitability pressures and macroeconomic challenges slightly temper the score.
Positive Factors
Capital Position
The bank's strong capital position and recent stock pullback might lead to better than expected buybacks, estimated at approximately $150 million per quarter in 2025.
Earnings
Regions Financial Corp beat consensus EPS by 5% on lower expenses.
Operating Leverage
The bank is expected to maintain positive operating leverage for the year.
Negative Factors
Loan Growth
Management expects FY25 loan growth to be relatively stable, slightly worse than prior guidance.
Net Interest Income
RF lowered FY25 net interest income guidance by 100bps.
Target Price
The target price for Regions Financial Corp. has been lowered to $28 from $30 due to a more conservative return on tangible common equity outlook.

Regions Financial (RF) vs. SPDR S&P 500 ETF (SPY)

Regions Financial Business Overview & Revenue Model

Company DescriptionRegions Financial Corporation, a financial holding company, provides banking and bank-related services to individual and corporate customers. It operates through three segments: Corporate Bank, Consumer Bank, and Wealth Management. The Corporate Bank segment offers commercial banking services, such as commercial and industrial, commercial real estate, and investor real estate lending; equipment lease financing; deposit products; and securities underwriting and placement, loan syndication and placement, foreign exchange, derivatives, merger and acquisition, and other advisory services. It serves corporate, middle market, and commercial real estate developers and investors. The Consumer Bank segment provides consumer banking products and services related to residential first mortgages, home equity lines and loans, consumer credit cards, and other consumer loans, as well as deposits. The Wealth Management segment offers credit related products, and retirement and savings solutions; and trust and investment management, asset management, and estate planning services to individuals, businesses, governmental institutions, and non-profit entities. The company also provides investment and insurance products; low-income housing tax credit corporate fund syndication services; and other specialty financing services. As of March 01, 2022, it operated through a network of 1,300 banking offices and 2,000 automated teller machines across the South, Midwest, and Texas. Regions Financial Corporation was founded in 1971 and is headquartered in Birmingham, Alabama.
How the Company Makes MoneyRegions Financial makes money primarily through its various banking operations. The company's revenue model is driven by interest income generated from loans and leases, which include commercial and industrial loans, residential mortgages, and consumer loans. Additionally, Regions earns non-interest income through service charges, wealth management fees, and mortgage banking activities. The company also benefits from strategic partnerships and investments that enhance its financial offerings and contribute to its earnings. Key revenue streams include net interest income from lending activities and fees from customer transactions and advisory services. Regions Financial's profitability is influenced by factors such as interest rate environments, economic conditions, and regulatory changes that affect banking operations.

Regions Financial Earnings Call Summary

Earnings Call Date:Apr 17, 2025
(Q1-2025)
|
% Change Since: 17.99%|
Next Earnings Date:Jul 18, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong earnings, an increase in pre-tax pre-provision income, and stable non-interest income with growth in deposits. However, challenges included a decline in net interest income, lower loan balances, and increased provisions for credit losses. The sentiment is balanced between positive financial performance and concerns over macroeconomic conditions and market volatility.
Q1-2025 Updates
Positive Updates
Strong Quarterly Earnings
Reported strong quarterly earnings of $465 million, resulting in earnings per share of $0.51 and adjusted earnings of $487 million with adjusted earnings per share of $0.54.
Increase in Pre-Tax Pre-Provision Income
Delivered pretax pre-provision income of $745 million, a 21% increase year over year.
Return on Tangible Common Equity
Generated a return on tangible common equity of 18%, highest among peers in the last four years.
Growth in Deposit Balances
Average deposit balances grew 1% quarter-over-quarter, with ending balances increasing by 3%.
Stable Non-Interest Income
Adjusted non-interest income remained stable, with new records in treasury and wealth management revenue.
Capital Position and Share Repurchase
Ended the quarter with an estimated common equity tier one ratio of 10.8% and executed $242 million in share repurchases.
Negative Updates
Decline in Net Interest Income
Net interest income declined 3% linked quarter, mostly driven by lower loan balances and less origination fee activity.
Lower Loan Balances
Ending loans declined 1%, with average consumer loans decreasing approximately 1% in the first quarter.
Capital Markets Revenue Decline
Decline in capital markets revenue driven by lower M&A, real estate capital markets, and loan syndication activity.
Increase in Provision for Credit Losses
Provision expense was approximately equal to net charge-offs at $124 million, with allowance for credit losses ratio increasing to 1.81%.
Company Guidance
During the Regions Financial Corporation's first-quarter earnings call for Fiscal Year 2025, the company reported strong financial results, including quarterly earnings of $465 million and adjusted earnings of $487 million. The earnings per share stood at $0.51, with an adjusted earnings per share of $0.54. The company achieved a 21% year-over-year increase in pretax pre-provision income, amounting to $745 million, and generated a return on tangible common equity of 18%. Despite a slight decline in average loans by 1%, the company saw a 1% increase in average deposit balances and a 3% rise in ending balances. Net interest income experienced a linked quarter decline of 3% but is projected to grow by 3% in the second quarter. The company maintained a strong capital position with an estimated common equity tier one ratio of 10.8%, executing $242 million in share repurchases and paying $226 million in common dividends. Additionally, Regions Financial adjusted its full-year guidance for net interest income growth to between 1% and 4%, and for adjusted non-interest income to grow between 1% and 3% compared to 2024. The company also forecasted flat to a 2% increase in full-year adjusted non-interest expenses, aiming for positive operating leverage in the range of 50 to 150 basis points.

Regions Financial Financial Statement Overview

Summary
Regions Financial demonstrates strong revenue growth and efficient cash flow management. The company maintains a robust gross profit margin and a solid equity base. However, a decrease in net profit margin and increasing liabilities require attention.
Income Statement
78
Positive
Regions Financial has demonstrated strong revenue growth, with a notable increase in total revenue from $6.898 billion in 2023 to $9.401 billion TTM (Trailing-Twelve-Months) in 2025. The gross profit margin remains robust, consistently exceeding 70%, indicating effective cost management. However, the net profit margin has slightly decreased over the periods, suggesting some pressure on bottom-line profitability. EBIT and EBITDA margins remain strong, reflecting healthy operational efficiency.
Balance Sheet
72
Positive
The balance sheet of Regions Financial shows a solid equity base with stockholders' equity increasing to $18.53 billion TTM. The debt-to-equity ratio remains low, indicating prudent financial leverage. However, the total liabilities have increased over the periods, which could pose a risk if not managed effectively. The equity ratio has remained stable, showcasing a balanced financial structure.
Cash Flow
75
Positive
The cash flow statement indicates a positive trajectory in operating cash flow, aligning well with net income trends. Free cash flow has also shown consistent growth, supporting the company's capacity for reinvestment and dividend payments. The operating cash flow to net income ratio is strong, suggesting efficient cash conversion from earnings.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
9.40B9.37B9.15B7.48B6.60B6.64B
Gross Profit
6.66B6.60B7.02B6.89B6.96B4.95B
EBIT
2.51B2.35B2.61B2.88B3.21B1.31B
EBITDA
2.63B2.50B2.84B3.23B3.59B1.74B
Net Income Common Stockholders
2.02B1.89B2.07B2.25B2.52B1.09B
Balance SheetCash, Cash Equivalents and Short-Term Investments
26.23B34.16B34.91B39.16B57.89B45.11B
Total Assets
128.80B157.30B152.19B155.22B162.94B147.39B
Total Debt
14.56B6.49B2.33B2.28B2.41B3.57B
Net Debt
10.75B-4.22B-4.47B-8.94B-27.00B-14.39B
Total Liabilities
113.28B139.39B134.70B139.27B144.61B129.28B
Stockholders Equity
15.51B17.88B17.43B15.95B18.33B18.11B
Cash FlowFree Cash Flow
2.24B1.45B2.15B2.81B2.96B2.27B
Operating Cash Flow
2.27B1.60B2.31B3.10B3.03B2.32B
Investing Cash Flow
-1.30B-262.00M-1.61B-12.94B-2.87B-4.85B
Financing Cash Flow
2.10B2.58B-5.13B-8.35B11.29B16.37B

Regions Financial Technical Analysis

Technical Analysis Sentiment
Positive
Last Price22.36
Price Trends
50DMA
20.64
Positive
100DMA
21.73
Positive
200DMA
22.56
Negative
Market Momentum
MACD
0.27
Negative
RSI
63.70
Neutral
STOCH
89.64
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RF, the sentiment is Positive. The current price of 22.36 is above the 20-day moving average (MA) of 21.66, above the 50-day MA of 20.64, and below the 200-day MA of 22.56, indicating a neutral trend. The MACD of 0.27 indicates Negative momentum. The RSI at 63.70 is Neutral, neither overbought nor oversold. The STOCH value of 89.64 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RF.

Regions Financial Risk Analysis

Regions Financial disclosed 50 risk factors in its most recent earnings report. Regions Financial 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

Regions Financial Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$23.76B12.5710.30%3.82%7.55%17.46%
MTMTB
76
Outperform
$29.82B12.449.39%2.93%1.20%1.12%
CFCFG
74
Outperform
$17.94B13.176.37%4.06%-2.12%13.92%
RFRF
74
Outperform
$19.82B10.6411.33%4.48%1.05%12.14%
73
Outperform
$26.31B12.5211.71%3.69%5.75%0.68%
64
Neutral
$12.83B9.787.78%16985.64%12.26%-7.81%
KEKEY
60
Neutral
$17.90B1,663.640.14%5.04%-12.50%-120.77%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
RF
Regions Financial
22.36
4.92
28.21%
FITB
Fifth Third Bancorp
39.78
5.77
16.97%
HBAN
Huntington Bancshares
16.31
4.48
37.87%
KEY
KeyCorp
16.35
3.56
27.83%
MTB
M&T Bank
185.76
48.89
35.72%
CFG
Citizens Financial
41.97
9.32
28.55%

Regions Financial Corporate Events

Business Operations and Strategy
Regions Financial to Present Strategic Priorities to Investors
Positive
May 5, 2025

Regions Financial Corporation announced that its executives will present the company’s operations and performance to institutional investors during May and June 2025. The presentations will highlight Regions’ strategic priorities, including diversified revenue streams, disciplined expense management, and strong capital management. The company emphasizes its consistent outperformance in risk efficiency and profitability compared to peers, driven by strategic investments in talent, technology, and market expansion. These efforts are expected to enhance Regions’ market position and stakeholder value.

Business Operations and StrategyFinancial Disclosures
Regions Financial Reports Strong Q1 Earnings Growth
Positive
Apr 17, 2025

On April 17, 2025, Regions Financial Corp. reported its first-quarter earnings for the period ending March 31, 2025, showing a net income available to common shareholders of $465 million, a 36% increase from the previous year. The company’s strategic focus on de-risking, hedging, and investment in talent and technology has positioned it well for sustainable performance across various economic conditions, as evidenced by a 2% year-over-year revenue growth to $1.8 billion.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.