Glacier Bancorp (GBCI)

Regional banking company Glacier Bancorp (NYSE:GBCI) beat Wall Street’s revenue expectations in Q3 CY2025, with sales up 19.3% year on year to $260.7 million. Its GAAP profit of $0.57 per share was 6.3% below analysts’ consensus estimates.

Company Overview

Operating through seventeen distinct bank divisions with local brands and management teams, Glacier Bancorp (NYSE:GBCI) is a bank holding company that provides various banking services to individuals and businesses across eight western 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.

Glacier Bancorp competes with other regional banks operating in the western United States, including Zions Bancorporation (NASDAQ:ZION), Columbia Banking System (NASDAQ:COLB), and First Interstate BancSystem (NASDAQ:FIBK), as well as national banks like Wells Fargo (NYSE:WFC) and Bank of America (NYSE:BAC) that have branches in its markets.

From lending activities to service fees, most banks build their revenue model around two income sources. Interest rate spreads between loans and deposits create the first stream, with the second coming from charges on everything from basic bank accounts to complex investment banking transactions. Over the last five years, Glacier Bancorp grew its revenue at a decent 5.2% compounded annual growth rate. Its growth was slightly above the average banking company and shows its offerings resonate with customers.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Glacier Bancorp’s annualized revenue growth of 5.2% over the last two years aligns with its five-year trend, suggesting its demand was stable. 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, Glacier Bancorp reported year-on-year revenue growth of 19.3%, and its $260.7 million of revenue exceeded Wall Street’s estimates by 1.7%.

Net interest income made up 83.1% of the company’s total revenue during the last five years, meaning Glacier Bancorp barely relies on non-interest income to drive its overall growth.

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.

Topline growth alone doesn't tell the complete story - the profitability of that growth shapes actual earnings impact. Banks track this dynamic through efficiency ratios, which compare non-interest expenses such as personnel, rent, IT, and marketing costs to total revenue streams.

Investors focus on efficiency ratio changes rather than absolute levels, understanding that expense structures vary by revenue mix. Counterintuitively, lower efficiency ratios indicate better performance since they represent lower costs relative to revenue.

Over the last five years, Glacier Bancorp’s efficiency ratio has increased by 11.2 percentage points, going from 51.8% to 65%. Said differently, the company’s expenses have increased at a faster rate than revenue, which usually raises questions unless the company is in high-growth mode and reinvesting its profits into attractive ventures.

Glacier Bancorp’s efficiency ratio came in at 64.4% this quarter, falling short of analysts’ expectations by 278.9 basis points (100 basis points = 1 percentage point). This result was 3 percentage points better than the same quarter last year.

For the next 12 months, Wall Street expects Glacier Bancorp to rein in some of its expenses as it anticipates an efficiency ratio of 59.2%.

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Sadly for Glacier Bancorp, its EPS declined by 4.4% annually over the last five years while its revenue grew by 5.2%. This tells us the company became less profitable on a per-share basis as it expanded.

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.

For Glacier Bancorp, its two-year annual EPS declines of 4.4% are similar to its five-year trend. These results were bad no matter how you slice the data.

In Q3, Glacier Bancorp reported EPS of $0.57, up from $0.45 in the same quarter last year. Despite growing year on year, this print missed analysts’ estimates. Over the next 12 months, Wall Street expects Glacier Bancorp’s full-year EPS of $2.05 to grow 35.1%.

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.

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.

Glacier Bancorp’s TBVPS grew at a tepid 3% annual clip over the last five years. However, TBVPS growth has accelerated recently, growing by 10.6% annually over the last two years from $16.73 to $20.46 per share.

Over the next 12 months, Consensus estimates call for Glacier Bancorp’s TBVPS to grow by 7.7% to $22.03, 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, Glacier Bancorp has averaged a Tier 1 capital ratio of 12.7%, which is considered safe and well capitalized in the event that macro or market conditions suddenly deteriorate.

Return on equity, or ROE, quantifies bank profitability relative to shareholder equity - an essential capital source for these institutions. Over extended periods, superior ROE performance drives faster shareholder wealth compounding through reinvestment, share repurchases, and dividend growth.

Over the last five years, Glacier Bancorp has averaged an ROE of 8.9%, respectable for a company operating in a sector where the average shakes out around 7.5% and those putting up 15%+ are greatly admired.

It was encouraging to see Glacier Bancorp beat analysts’ revenue expectations this quarter. We were also happy its tangible book value per share outperformed Wall Street’s estimates. On the other hand, its efficiency ratio and EPS both missed. Overall, this was a mixed quarter. The stock remained flat at $45.05 immediately following the results.

Updated: December 3, 2025 at 11:47 PM EST

Before making an investment decision, investors should account for Glacier Bancorp’s business fundamentals and valuation in addition to what happened in the latest quarter.

Glacier Bancorp doesn’t pass our quality test. First off, its revenue growth was uninspiring over the last five years. And while its estimated net interest income growth for the next 12 months is great, the downside is its declining EPS over the last five years makes it a less attractive asset to the public markets. On top of that, its worsening efficiency ratio shows the business has become less productive.

Glacier Bancorp’s P/B ratio based on the next 12 months is 1.3x. This multiple tells us a lot of good news is priced in - we think other companies feature superior fundamentals at the moment.

Wall Street analysts have a consensus one-year price target of $52.50 on the company (compared to the current share price of $42.70).

Although the price target is bullish, readers should exercise caution because analysts tend to be overly optimistic. The firms they work for, often big banks, have relationships with companies that extend into fundraising, M&A advisory, and other rewarding business lines. As a result, they typically hesitate to say bad things for fear they will lose out. We at StockStory do not suffer from such conflicts of interest, so we’ll always tell it like it is.