Amalgamated Financial Surges After Q4 Profit Beats Estimates
The bank posted record deposit growth of nearly $1 billion and expanded its net interest margin, sending shares up more than 6% in morning trading.
Shares of Amalgamated Financial Corp. (NASDAQ: AMAL) jumped more than 6% on Thursday after the bank reported fourth-quarter earnings that significantly surpassed analyst expectations, fueled by record deposit inflows and a robust expansion in profitability margins.
The New York-based bank, known for its focus on socially responsible initiatives, saw its stock price climb to approximately $36.03 in morning trading, pushing it past its pre-report 52-week high. The rally came after the company disclosed core earnings of $0.99 per share, beating Wall Street's consensus estimate of $0.875 by more than 13%.
The standout figure in the report was the bank's ability to attract new capital. Amalgamated gathered nearly $1 billion in new on- and off-balance sheet deposits during the fourth quarter, a record for the institution. This performance is particularly notable in a competitive environment where banks are vying for customer funds amid fluctuating interest rates.
That deposit growth helped bolster a key metric of bank profitability. Amalgamated’s net interest margin (NIM) — the difference between the interest it earns on loans and pays on deposits — expanded by 6 basis points to 3.66%. The sustained margin strength suggests efficient management and a resilient business model despite pressures faced by the broader regional banking sector.
"This quarter’s outstanding results are a testament to the strength of our unique brand and the disciplined execution of our strategy," the company stated in its earnings release. "Record deposit gathering demonstrates that our mission-driven approach resonates deeply with a growing base of individuals, unions, non-profits, and political organizations."
In a further sign of confidence in its financial standing, Amalgamated repurchased approximately 309,000 shares of its common stock during the quarter. Such buybacks are often interpreted by investors as an indication that management believes the company's stock is undervalued and is committed to returning capital to shareholders.
The bank's strategy is deeply rooted in its identity as America’s largest B Corp certified bank. With a stated mission to be the financial institution for progressive people and organizations, Amalgamated has focused its lending on climate solutions and social impact projects. This niche has created a loyal customer base and a differentiated value proposition that appears to be paying dividends, attracting what is often described as 'sticky' deposits from mission-aligned clients.
Prior to the earnings release, analysts held a consensus 'Strong Buy' rating on the stock with a price target of $34.50. Thursday's surge propelled the stock well beyond that target, suggesting that analysts may revise their expectations upward in the coming days.
For the full year, Amalgamated has navigated the complex macroeconomic environment facing many regional banks, from shifting Federal Reserve policy to heightened regulatory scrutiny. The strong finish to the year positions the bank on solid footing as it enters the new fiscal year, leveraging its distinct market position to drive growth that stands apart from many of its peers.