WesBanco (WSBC)

Regional banking company WesBanco (NASDAQ:WSBC) met Wall Streets revenue expectations in Q4 CY2025, with sales up 62.6% year on year to $265.6 million. Its non-GAAP profit of $0.84 per share was 1.2% below analysts’ consensus estimates.

Company Overview

Tracing its roots back to 1870 in West Virginia, WesBanco (NASDAQ:WSBC) is a bank holding company that provides retail and commercial banking, trust services, insurance, and investment products through its subsidiaries across several Midwestern and Mid-Atlantic states.

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.

WesBanco competes with other regional banks operating in the Mid-Atlantic and Midwest regions such as F.N.B. Corporation (NYSE:FNB), Northwest Bancshares (NASDAQ:NWBI), and S&T Bancorp (NASDAQ:STBA), as well as larger national banks like JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC), and PNC Financial Services (NYSE:PNC) that have branches in WesBanco's markets.

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, WesBanco’s revenue grew at a mediocre 10% compounded annual growth rate over the last five years. This was below our standard for the banking sector and is a tough starting point for our analysis.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. WesBanco’s annualized revenue growth of 27.4% over the last two years is above its five-year trend, suggesting its demand recently accelerated. 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, WesBanco’s year-on-year revenue growth of 62.6% was magnificent, and its $265.6 million of revenue was in line with Wall Street’s estimates.

Net interest income made up 79.6% of the company’s total revenue during the last five years, meaning lending operations are WesBanco’s largest source of revenue.

Our experience and research show the market cares primarily about a bank’s net interest income growth as non-interest income is considered a lower-quality and non-recurring revenue source.

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.

WesBanco’s EPS grew at a solid 12% compounded annual growth rate over the last five years, higher than its 10% annualized revenue growth. However, we take this with a grain of salt because its efficiency ratio didn’t improve and it didn’t repurchase its shares, meaning the delta came from factors we consider non-core or less sustainable over the long term.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

Although it performed well, WesBanco’s two-year annual EPS growth of 14.4% lower than its 27.4% two-year revenue growth.

Diving into WesBanco’s quality of earnings can give us a better understanding of its performance. A two-year view shows WesBanco has diluted its shareholders, growing its share count by 61.8%. This has led to lower per share earnings. Taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q4, WesBanco reported adjusted EPS of $0.84, up from $0.71 in the same quarter last year. Despite growing year on year, this print slightly missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects WesBanco’s full-year EPS of $3.35 to grow 13%.

The balance sheet drives banking profitability since earnings flow from the spread between borrowing and lending rates. As such, valuations for these companies concentrate on capital strength and sustainable equity accumulation potential.

When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. Traditional metrics like EPS are helpful but face distortion from M&A activity and loan loss accounting rules.

WesBanco’s TBVPS was flat over the last five years. However, TBVPS growth has accelerated recently, growing by 2% annually over the last two years from $21.16 to $22.01 per share.

Over the next 12 months, Consensus estimates call for WesBanco’s TBVPS to grow by 10% to $24.22, mediocre 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, WesBanco has averaged a Tier 1 capital ratio of 10.7%, which is considered safe and well capitalized in the event that macro or market conditions suddenly deteriorate.

Return on equity (ROE) measures how effectively banks generate profit from each dollar of shareholder equity - a critical funding source. High-ROE institutions typically compound shareholder wealth faster over time through retained earnings, share repurchases, and dividend payments.

Over the last five years, WesBanco has averaged an ROE of 6.8%, uninspiring for a company operating in a sector where the average shakes out around 7.5%.

It was good to see WesBanco narrowly top analysts’ tangible book value per share expectations this quarter. On the other hand, its EPS slightly missed. Overall, this was a softer quarter. The stock remained flat at $35.23 immediately following the results.

Updated: January 27, 2026 at 11:19 PM EST

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

WesBanco isn’t a terrible business, but it isn’t one of our picks. To kick things off, its revenue growth was mediocre over the last five years. And while its expanding net interest margin shows its loan book is becoming more profitable, the downside is its TBVPS growth was weak over the last five years. On top of that, its relatively low ROE suggests management has struggled to find compelling investment opportunities.

WesBanco’s P/B ratio based on the next 12 months is 0.8x. This valuation multiple is fair, but we don’t have much faith in the company. We're fairly confident there are better investments elsewhere.

Wall Street analysts have a consensus one-year price target of $38.14 on the company (compared to the current share price of $35.23).