BOK Financial (BOKF)

Regional banking company BOK Financial (NASDAQ:BOKF) announced better-than-expected revenue in Q3 CY2025, with sales up 5.8% year on year to $546.4 million. Its GAAP profit of $2.22 per share was 1.8% above analysts’ consensus estimates.

Company Overview

Tracing its roots back to 1910 when Oklahoma was still a young state, BOK Financial (NASDAQ:BOKF) is a regional bank holding company that provides commercial banking, consumer banking, and wealth management services across eight states in the central and southwestern US.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

BOK Financial competes with other regional banks operating in the South and Midwest such as Comerica (NYSE:CMA), Cullen/Frost Bankers (NYSE:CFR), and Zions Bancorporation (NASDAQ:ZION), as well as larger national banks including JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC), and Wells Fargo (NYSE:WFC).

Two primary revenue streams drive bank earnings. While net interest income, which is earned by charging higher rates on loans than paid on deposits, forms the foundation, fee-based services across banking, credit, wealth management, and trading operations provide additional income. Regrettably, BOK Financial’s revenue grew at a tepid 2.1% compounded annual growth rate over the last five years. This fell short of our benchmarks and is a rough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. BOK Financial’s recent performance shows its demand has slowed as its revenue was flat over the last two years. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, BOK Financial reported year-on-year revenue growth of 5.8%, and its $546.4 million of revenue exceeded Wall Street’s estimates by 1.3%.

Net interest income made up 61.7% of the company’s total revenue during the last five years, meaning lending operations are BOK Financial’s largest source of revenue.

While banks generate revenue from multiple sources, investors view net interest income as the cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of non-interest income.

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

BOK Financial’s EPS grew at a spectacular 8.6% compounded annual growth rate over the last five years, higher than its 2.1% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its efficiency ratio didn’t improve.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For BOK Financial, its two-year annual EPS declines of 4.8% mark a reversal from its (seemingly) healthy five-year trend. We hope BOK Financial can return to earnings growth in the future.

In Q3, BOK Financial reported EPS of $2.22, up from $2.18 in the same quarter last year. This print beat analysts’ estimates by 1.8%. Over the next 12 months, Wall Street expects BOK Financial’s full-year EPS of $8.39 to grow 5.8%.

Banks operate as balance sheet businesses, with profits generated through borrowing and lending activities. Valuations reflect this reality, emphasizing balance sheet strength and long-term book value compounding ability.

Because of this, tangible book value per share (TBVPS) emerges as the critical performance benchmark. By excluding intangible assets with uncertain liquidation values, this metric captures real, liquid net worth per share. On the other hand, EPS is often distorted by mergers and flexible loan loss accounting. TBVPS provides clearer performance insights.

BOK Financial’s TBVPS grew at a solid 6.3% annual clip over the last five years. TBVPS growth has also accelerated recently, growing by 17.7% annually over the last two years from $56.40 to $78.11 per share.

Over the next 12 months, Consensus estimates call for BOK Financial’s TBVPS to grow by 7.9% to $84.30, decent growth rate.

Leverage is core to a financial firm’s business model (loans funded by deposits). To ensure economic stability and avoid a repeat of the 2008 GFC, regulators require certain levels of capital and liquidity, focusing on the Tier 1 capital ratio.

Tier 1 capital is the highest-quality capital that a firm holds, consisting primarily of common stock and retained earnings, but also physical gold. It serves as the primary cushion against losses and is the first line of defense in times of financial distress.

This capital is divided by risk-weighted assets to derive the Tier 1 capital ratio. Risk-weighted means that cash and US treasury securities are assigned little risk while unsecured consumer loans and equity investments get much higher risk weights, for example.

New regulation after the 2008 financial crisis requires that all firms must maintain a Tier 1 capital ratio greater than 4.5%. On top of this, there are additional buffers based on scale, risk profile, and other regulatory classifications, so that at the end of the day, firms generally must maintain a 7-10% ratio at minimum.

Over the last two years, BOK Financial has averaged a Tier 1 capital ratio of 12.8%, which is considered safe and well capitalized in the event that macro or market conditions suddenly deteriorate.

Return on equity (ROE) reveals the profit generated per dollar of shareholder equity, which represents a key source of bank funding. Banks maintaining elevated ROE levels tend to accelerate wealth creation for shareholders via earnings retention, buybacks, and distributions.

Over the last five years, BOK Financial has averaged an ROE of 10.6%, impressive for a company operating in a sector where the average shakes out around 7.5% and those putting up 15%+ are greatly admired. This is a bright spot for BOK Financial.

It was good to see BOK Financial narrowly top analysts’ revenue expectations this quarter. We were also happy its tangible book value per share narrowly outperformed Wall Street’s estimates. On the other hand, its EPS slightly beat and its net interest income fell slightly short of Wall Street’s estimates. Overall, this was a softer quarter. The stock remained flat at $110 immediately after reporting.

Updated: December 3, 2025 at 11:29 PM EST

Are you wondering whether to buy BOK Financial or pass? We urge investors to not only consider the latest earnings results but also longer-term business quality and valuation as well.

BOK Financial falls short of our quality standards. To begin with, its revenue growth was weak over the last five years. And while its TBVPS growth was solid over the last five years, the downside is its net interest income growth was weak over the last five years. On top of that, its net interest margin limits its operating profit potential compared to other banks that can earn more, all else equal..

BOK Financial’s P/B ratio based on the next 12 months is 1.2x. At this valuation, there’s a lot of good news priced in - we think there are better opportunities elsewhere.

Wall Street analysts have a consensus one-year price target of $118.70 on the company (compared to the current share price of $116.53).