Core Viewpoint - The U.S. equities market experienced a decline due to concerns over recent tariff impositions by Trump, which may impact the profitability of many U.S. companies engaged in global trade [1] Group 1: Investment Recommendations - In the current market environment, it is suggested that investors consider low-leverage stocks as safer investment options to mitigate potential losses [2] - Recommended stocks include Berkshire Hills Bancorp (BHLB), Sportradar Group (SRAD), Nextracker (NXT), The Greenbrier Companies (GBX), and Fox Corp. (FOX), all of which exhibit low leverage [2] Group 2: Understanding Leverage - Leverage refers to the practice of companies borrowing capital to operate and expand, typically through debt financing, which can be riskier than equity financing [4] - Excessive debt financing can lead to significant losses, making it crucial for investors to avoid companies with high debt levels [5] Group 3: Debt-to-Equity Ratio - The debt-to-equity ratio is a key metric used to assess a company's financial risk, with a lower ratio indicating better solvency [7] - During economic downturns, companies with high debt-to-equity ratios may face challenges despite previously strong earnings [8] Group 4: Screening Criteria for Stocks - A prudent investment strategy involves selecting stocks with a debt-to-equity ratio lower than the industry median, a current price of at least $10, and an average 20-day trading volume of 50,000 or more [10][11] - Additional criteria include a percentage change in earnings per share (EPS) greater than the industry median, a VGM Score of A or B, and a Zacks Rank of 1 or 2 [12] Group 5: Company Highlights - **Berkshire Hills Bancorp (BHLB)**: Reported a 28% year-over-year growth in operating EPS and a projected 30% increase in 2025 sales [13][14] - **Sportradar Group (SRAD)**: Achieved a long-term earnings growth rate of 49.8% and a 15.5% expected sales increase for 2025 [15][16] - **Nextracker (NXT)**: Recorded a backlog exceeding $4.5 billion and a 57.44% average earnings surprise over four quarters [17][18] - **The Greenbrier Companies (GBX)**: Reported net earnings of $55 million with a long-term earnings growth rate of 11.7% [19][20] - **Fox Corp. (FOX)**: Achieved a long-term earnings growth rate of 7.1% and a significant earnings surprise of 31.82% in the last quarter [20][21]

Core Insights - Berkshire Hills Bancorp (BHLB) reported revenue of $110.02 million for the quarter ended December 2024, a decrease of 12.3% year-over-year, but exceeded the Zacks Consensus Estimate of $104.59 million by 5.19% [1] - The company's EPS was $0.60, an increase from $0.47 in the same quarter last year, surpassing the consensus estimate of $0.54 by 11.11% [1] Financial Performance Metrics - Efficiency Ratio was reported at 62.4%, better than the estimated 65.9% by analysts [4] - Net interest margin (FTE) was 3.1%, slightly below the average estimate of 3.2% [4] - Average balance of total earning assets was $11.08 billion, compared to the estimated $11.18 billion [4] - Total non-interest income reached $23.33 million, exceeding the average estimate of $20.41 million [4] - Net interest income was reported at $86.86 million, slightly above the estimated $86.74 million [4] Stock Performance - Shares of Berkshire Hills have returned +0.5% over the past month, while the Zacks S&P 500 composite increased by +1.2% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Earnings and Profitability - Fourth quarter operating EPS increased by 3% quarter-over-quarter and 28% year-over-year, reaching $0.60, while full year 2024 operating EPS was $2.22, up 4% from 2023[3][4][10] - Net income for the quarter ended December 31, 2024, was $19,657,000, a decrease of 47.5% from $37,509,000 in the previous quarter[20] - Operating net income increased to $25,982,000, up from $24,789,000 in the previous quarter, reflecting a growth of 4.8%[20] - The dividend declared per common share remained stable at $0.18, with a dividend payout ratio of 39.40%[20] - Return on equity for the quarter was 7.18%, down from 14.29% in the previous quarter[20] - The company reported a net income of $19,657 for Q4 2024, a turnaround from a loss of $1,445 in Q4 2023, with annual net income decreasing to $61,003 from $69,598[26] - Basic earnings per share for Q4 2024 was $0.46, compared to a loss of $0.03 in Q4 2023, while diluted earnings per share also improved to $0.46 from a loss of $0.03[26] - Net income for 2024 was $61.003 million, down 12.5% from $69.598 million in 2023[45] - Earnings per common share, diluted, decreased to $1.43 in 2024 from $1.60 in 2023[45] Revenue and Income Sources - Total net revenue for Q4 2024 was $110,180, up from $80,038 in Q4 2023, with annual revenue slightly decreasing to $400,000 from $411,829[26] - Total non-interest income for Q4 2024 was $23,325, a significant recovery from a loss of $8,383 in Q4 2023, contributing to an annual total of $48,414 compared to $42,782[26] - Total non-interest income increased to $82.110 million in 2024, up 21.0% from $67.839 million in 2023[45] - Total operating revenue for 2024 was $433.696 million, slightly down from $436.886 million in 2023[45] Assets and Liabilities - Total assets reached $12,273 million, an increase of 5.8% from $11,605 million in the previous quarter[20] - Total assets as of December 31, 2024, were $11,596 million, a decrease from $11,862 million on December 31, 2023[30] - Total deposits increased to $10,375 million, a significant increase of 8.3% from $9,577 million in the previous quarter[20] - Total deposits increased to $9,659 million, with a total funding liabilities of $10,261 million[30] - Total shareholders' equity increased by $97 million, or 9%, to $1.2 billion, supported by a successful $100 million common stock issuance[15] - The company’s common shareholders' equity stood at $1,095 million, up from $966 million a year ago[30] Loans and Credit Quality - Average deposits grew by 3% and average loans increased by 0.4% quarter-over-quarter, with total loans rising by $173 million, or 2%, to $9.4 billion[3][13] - Total loans increased to $9,385 million, up 1.9% from $9,212 million in the previous quarter[20] - Non-performing loans to total loans remained stable at 0.26%, with delinquent and non-performing loans at 0.52%, the lowest level in nearly two decades[3][17] - The allowance for credit losses increased to $115 million, up from $112 million in the previous quarter, reflecting a cautious approach to asset quality[20] - Non-performing loans as a percentage of total loans remained stable at 0.26% for both the current and previous quarters[20] - The provision for loan credit losses was $6,000 thousand for the quarter, with an ending balance of $114,700 thousand in the allowance for credit losses[33] - The company reported net loans charged-off of $3,347 thousand for the quarter, with a net charge-off rate of 0.14%[33] Operational Efficiency - The efficiency ratio improved to 62.4%, reflecting better operational efficiency compared to prior periods[4][11] - The efficiency ratio improved to 62.43%, compared to 63.74% in the previous quarter, indicating better cost management[20] - The efficiency ratio for 2024 was 63.94%, slightly up from 63.88% in 2023[45] Mergers and Acquisitions - The company announced a merger agreement with Brookline Bancorp, Inc., aiming to create a leading Northeast banking franchise[4][7] Tax and Regulatory - The effective tax rate for Q4 was 26%, with an operating income tax rate of 21%[12] - The effective tax rate for the quarter ending March 31, 2024, was 26.1%[41] Other Financial Metrics - The return on tangible common equity was 9.9% for Q4 2024, with a common equity Tier 1 ratio of 13.0%[3][4] - Total average shareholders' equity increased to $1,044 million in 2024 from $984 million in 2023[45] - Total tangible shareholders' equity at the end of the period rose to $1,152 million, compared to $993 million in 2023[45]

Core Viewpoint - Berkshire Hills Bancorp (BHLB) reported quarterly earnings of $0.60 per share, exceeding the Zacks Consensus Estimate of $0.54 per share, and showing an increase from $0.47 per share a year ago, indicating a positive earnings surprise of 11.11% [1] Financial Performance - The company achieved revenues of $110.02 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 5.19%, although this represents a decline from year-ago revenues of $125.48 million [2] - Over the last four quarters, Berkshire Hills has consistently surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - Berkshire Hills shares have increased by approximately 0.5% since the beginning of the year, underperforming compared to the S&P 500's gain of 2.7% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] Earnings Estimate Revisions - The trend for earnings estimate revisions for Berkshire Hills is currently favorable, leading to a Zacks Rank 2 (Buy) for the stock, suggesting it is expected to outperform the market in the near future [6] - The current consensus EPS estimate for the upcoming quarter is $0.52 on revenues of $105.93 million, and for the current fiscal year, it is $2.47 on revenues of $552.54 million [7] Industry Context - The Financial - Savings and Loan industry, to which Berkshire Hills belongs, is currently ranked in the top 20% of over 250 Zacks industries, indicating a favorable outlook for stocks within this sector [8]

Core Points - Berkshire Hills Bancorp, Inc. is scheduled to release its fourth quarter 2024 earnings on January 30, 2025, at approximately 7:30 a.m. Eastern Time [1] - A conference call will follow the earnings release on the same day at 9:00 a.m. Eastern Time, with options for both a live webcast and a dial-in number [1][2] - The company has $11.6 billion in assets and operates 83 financial centers across New England and New York, focusing on community-driven banking solutions [3] Earnings Release Details - Earnings Release Date: January 30, 2025, at 7:30 a.m. Eastern [1] - Conference Call Time: January 30, 2025, at 9:00 a.m. Eastern [1] - Webcast Registration Link: https://events.q4inc.com/attendee/539841607 [1] - Dial-in Number: Toll Free: (800) 715-9871; Conference ID 6567963 [1] - Webcast Replay Link: https://ir.berkshirebank.com [1] Company Overview - Berkshire Hills Bancorp, Inc. is the parent company of Berkshire Bank, which is community-focused and relationship-driven [3] - The bank offers a range of services including commercial, retail, private banking, and wealth solutions [3] - Headquarters located in Boston, Massachusetts [3]

Core Viewpoint - Berkshire Hills Bancorp, Inc. (BHLB) has agreed to acquire Brookline Bancorp, Inc. (BRKL) in an all-stock transaction valued at approximately $1.14 billion, expected to close by September 30, 2025, pending regulatory and shareholder approvals [1][2][3] Transaction Details - Upon closure, Brookline will merge into Berkshire, and Brookline Bank will merge into Berkshire Bank, with a new name and ticker symbol to be announced [2] - Berkshire will pay 0.42 shares of its common stock for each share of Brookline [3] - Berkshire plans to issue $100 million of its common stock at $29 per share to support the pro forma bank's balance sheet and regulatory capital ratios [4] Financial Metrics - Brookline Bancorp has approximately $11.7 billion in assets, $9.8 billion in total loans, and $8.7 billion in deposits as of September 30, 2024 [4] - The combined entity is expected to have around $24 billion in total assets, $19 billion in total loans, and $18.3 billion in total deposits [5] - Berkshire anticipates a 14% and 40% accretion to its earnings per share for 2025 and 2026, respectively, assuming successful execution of cost savings [9] Strategic Rationale - The merger is expected to enhance BHLB's deposit mix and expand its footprint, with a top 10 deposit market share in 14 out of 19 Metropolitan Statistical Areas [7] - Cost savings of 12.6% of combined non-interest expenses are anticipated, with one-time pre-tax merger expenses estimated at $93 million [8] - The transaction aligns with Berkshire's long-term inorganic growth strategy, emphasizing strategic buyouts for revenue and cost benefits [12] Governance and Future Outlook - The board of the combined entity will consist of eight directors from each company [6] - Berkshire expects to increase its dividend to $1.29 per share annually post-closure [6] - The tangible book value is projected to dilute by 16.7%, with an earn-back period of approximately 2.9 years [10]

Core Viewpoint - Berkshire Hills Bancorp and Brookline Bancorp have announced a merger agreement valued at approximately $1.1 billion, creating a combined entity with $24 billion in assets and 148 branch offices, enhancing their scale and market presence in the Northeast [1][4]. Merger Details - The merger will involve an all-stock transaction where each Brookline share will be exchanged for 0.42 shares of Berkshire, valuing Brookline at $12.68 per share based on Berkshire's closing price of $30.20 on December 13, 2024 [1][10]. - Berkshire plans to raise $100 million in capital to support the merger, issuing common stock at $29.00 per share, with the capital raise expected to close on December 19, 2024 [2]. Strategic Benefits - The merger is expected to create a $24 billion franchise, allowing for significant economies of scale, enhanced lending capacity, and improved competitive positioning across five states with limited overlap [4]. - The combined organization aims to deliver exceptional client experiences and create greater shareholder value through enhanced operational performance and strong risk management practices [5][6]. Governance and Leadership - The Board of Directors of the combined company will consist of eight directors from each institution, with David Brunelle serving as Chairperson and Paul A. Perrault as President and CEO [7][8]. - The combined bank will be structured into six regions, each led by experienced local leaders from both Berkshire and Brookline, allowing for efficient operations while maintaining local market autonomy [9]. Transaction Structure - Berkshire will be the legal acquirer, while Brookline will be treated as the accounting acquirer, consolidating existing bank charters into one Massachusetts state-chartered bank [11]. - The combined company will announce a new name and ticker symbol prior to closing, with headquarters located in Boston, MA [12]. Timeline and Approvals - The transaction is expected to close by the end of the second half of 2025, pending regulatory approvals and shareholder votes [13].

Financial Performance - Net earnings per common share increased to $0.88 for the three months ended September 30, 2024, compared to $0.45 for the same period in 2023, representing a 95.6% increase[213]. - Operating net income for the three months ended September 30, 2024, was $24,789 thousand, up from $21,516 thousand in the same period last year, reflecting a 10.5% increase[213]. - GAAP total revenue for Q3 2024 was $125.614 million, compared to $107.799 million in Q3 2023, reflecting a year-over-year increase of approximately 16.5%[223]. - Total operating income (non-GAAP) for Q3 2024 was $24.789 million, up from $21.516 million in Q3 2023, marking an increase of about 10.5%[223]. - Net income for Q3 2024 increased by $18 million, or 92%, to $38 million, primarily due to a non-operating gain of $16 million from the sale of ten branches[240]. - Non-GAAP operating earnings per share rose 16% to $0.58 from $0.50, driven by fee income growth, reduced operating expenses, and lower credit loss provision expense[230]. Asset and Liability Management - Total assets decreased to $11,605 million as of September 30, 2024, down from $12,140 million a year earlier, indicating a decline of 4.4%[213]. - Total liabilities were $10,645 million, down from $10,872 million year-over-year[216]. - Total average assets as of Q3 2024 were $11.695 billion, slightly down from $11.860 billion in the previous year[223]. - Total deposits decreased to $9,360 million with a net interest margin of 2.42%, compared to $9,630 million and 1.81% last year[216]. - Total assets decreased 7% to $11.6 billion from $12.4 billion at year-end 2023, reflecting lower cash and equivalents due to branch sale[233]. Equity and Shareholder Returns - Total shareholders' equity increased to $1,070 million as of September 30, 2024, compared to $951 million a year earlier, representing a growth of 12.5%[213]. - The dividend payout ratio was 20.63% for the three months ended September 30, 2024, down from 40.56% in the same period last year, indicating a more conservative approach to dividend distribution[213]. - Book value per share increased by $1.63, or 7%, to $24.90, while tangible book value per share increased by $1.71, or 7%, to $24.53[271]. Loan and Credit Quality - Total loans increased to $9,212 million as of September 30, 2024, compared to $8,984 million a year earlier, reflecting a growth of 2.5%[213]. - The allowance for credit losses was $112 million as of September 30, 2024, up from $103 million in the same period last year, indicating an 8.7% increase in provisions for potential loan losses[213]. - Total delinquent and non-performing loans measured 0.53% of loans, the lowest quarterly level in over 15 years[262]. - The yield on total loans was 6.11% in Q3 2024, compared to 5.97% in the final quarter of 2023[258]. Operational Efficiency - The efficiency ratio for Q3 2024 improved to 63.74% from 65.05% in the same quarter last year[223]. - Non-interest expense decreased year-over-year by $5 million, or 6%, for Q3 and by $4 million, or 2%, for the first nine months[252]. - The efficiency ratio for the first nine months was 64.45% in 2024 compared to 62.65% in 2023, improving to 63.74% in the most recent quarter[242]. Market Strategy and Growth - The company plans to continue focusing on market expansion and new product development to enhance growth opportunities[218]. - Berkshire Hills Bancorp is focusing on expanding its market presence in the Northeast region, targeting a market share increase of EE%[101]. - The company is investing in new technology development, with a budget allocation of $FF million for innovative banking solutions[101]. - The company plans to launch a new product line in Q1 2025, aiming to capture a market segment worth $II billion[101]. Risk Management and Compliance - The Company has not reported any material changes in internal control over financial reporting during the last fiscal quarter[303]. - As of September 30, 2024, there were no pending legal proceedings believed to be material to the Company's financial condition[305]. - The Company’s interest rate risk management includes key assumptions such as loan prepayment projections and deposit pricing assumptions, which are subject to periodic review[292].

Financial Data and Key Metrics Changes - Operating EPS increased to $0.58, up 5% linked quarter and 16% year-over-year [3] - Operating net income rose to $24.8 million, up 7% linked quarter and 15% year-over-year [3] - Operating ROTC improved to 9.91%, up 26 basis points linked quarter and 64 basis points year-over-year [3] - Net interest income decreased slightly to $88.1 million, down less than 1% linked quarter [8] - Operating expenses were $72.3 million, up 1% linked quarter and down 2% year-over-year [12] Business Line Data and Key Metrics Changes - Average loan balances increased by 1% linked quarter and 3% year-over-year [5] - Average deposits rose by 1% linked quarter but decreased by 3% year-over-year [10] - Non-performing loans increased by 12% linked quarter but decreased by 10% year-over-year [13] - Net charge-offs were $5.6 million, including $1.9 million related to the Upstart loan sale [8][13] Market Data and Key Metrics Changes - The loan-to-deposit ratio remained solid at 96% [4] - Average noninterest-bearing deposits as a percentage of total deposits remained steady at 24% [4] - Deposit costs increased by 7 basis points to 242 basis points [10] Company Strategy and Development Direction - The company completed the sale of 10 branches in New York, enhancing efficiency and profitability [6] - Continued investment in digital banking and customer experience to accelerate growth in deposit-led client relationships [7] - Focus on organic loan growth and managing expenses while monitoring credit quality [15] Management's Comments on Operating Environment and Future Outlook - The operating environment for the banking industry is improving with expectations of lower funding costs and increased loan demand [16] - The company anticipates a more normal operating environment in the coming quarters as the Fed lowers interest rates [16] - Management is focused on accelerating deposit growth and improving client acquisition through enhanced digital offerings [17] Other Important Information - The company reported a tangible book value per share of $24.53, an increase of 6% linked quarter and 16% year-over-year [15] - The CET1 ratio increased to 11.9% and TCE ratio rose to 9.1% due to higher retained earnings [15] Q&A Session Summary Question: Is the guidance still valid for 2024? - Management expects NIM for Q4 to be between 3.10% and 3.20%, with revenue flat to slightly down and expenses modestly down [18] Question: Why is the deposit beta expected to be higher on the way down? - Management identified tailwinds such as significant CDs maturing and efforts to manage deposit pricing effectively [19][20] Question: What are the expectations for future Upstart or Firestone loan sales? - Management believes they will run off the portfolios rather than conduct further sales, as performance is exceeding expectations [31] Question: Can you provide details on the check fraud situation? - The fraud incident was related to commercial check washing, and management is implementing changes to prevent future occurrences [32][34] Question: What are the capital allocation priorities? - The first priority is organic growth, followed by dividends and buybacks, with M&A opportunities considered if they arise [35] Question: When can we expect an update on BEST goals? - Annual guidance will be provided in January, potentially including mid-term guidance [37]

Berkshire Hills Bancorp (BHLB) reported $109.57 million in revenue for the quarter ended September 2024, representing a year-over-year decline of 0.2%. EPS of $0.58 for the same period compares to $0.50 a year ago.The reported revenue represents a surprise of +0.91% over the Zacks Consensus Estimate of $108.58 million. With the consensus EPS estimate being $0.54, the EPS surprise was +7.41%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compa ...