Eastern Bank’s fourth quarter results were met with a negative market reaction, despite the company beating Wall Street’s revenue and non-GAAP profit expectations. Management attributed the quarter’s performance to the successful integration of the HarborOne merger, robust organic loan growth—particularly within the commercial lending segment—and record-high wealth management assets. CEO Denis Sheahan emphasized the impact of recent talent investments and noted, “Our lending teams, both new hires and long-tenured relationship managers, remain energized.”
Is now the time to buy EBC? Find out in our full research report (it’s free for active Edge members).
Eastern Bank (EBC) Q4 CY2025 Highlights:
- Revenue: $290.1 million vs analyst estimates of $284.2 million (31.3% year-on-year growth, 2.1% beat)
- Adjusted EPS: $0.44 vs analyst estimates of $0.41 (6.9% beat)
- Adjusted Operating Income: $129.1 million vs analyst estimates of $129.3 million (44.5% margin, in line)
- Market Capitalization: $4.50 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Eastern Bank’s Q4 Earnings Call
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Feddie Strickland (Hovde) asked about the near-term margin outlook. CFO David Rosato explained the margin should remain relatively flat before improving later in the year, depending on interest rate changes.
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Damon Del Monte (KBW) inquired about provision guidance and credit trends. Rosato responded that expectations are conservative, and there are no underlying credit quality concerns influencing the provision outlook.
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Gregory Zingone (Piper Sandler) sought clarification on nonperforming loans and potential loan sales. Rosato clarified that most problematic loans stemmed from HarborOne, are well reserved, and management does not foresee the need for large-scale portfolio sales.
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Laura Havener Hunsicker (Seaport Research) questioned the rationale behind the shift away from acquisitions. CEO Denis Sheahan reiterated the company’s focus on organic growth and returning capital via buybacks, stating acquisitions are not on the agenda.
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Sun Young Lee (TD Cowen) asked about the outlook for fee income, especially from the newly acquired mortgage business. Rosato noted the mortgage business could contribute 8–10% of fee income and would benefit from any decline in rates, though the current outlook assumes stable market conditions.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be watching (1) the pace of organic loan and deposit growth, particularly in commercial lending and wealth management, (2) the effectiveness of cost discipline and integration from the HarborOne merger, and (3) the company’s execution on its capital return plans, including the timing of additional share repurchase authorizations. Progress on resolving nonperforming loans acquired from HarborOne will also be a key indicator.
Eastern Bank currently trades at $19.94, down from $20.36 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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