Why WaFd (WAFD) Is Back In The Spotlight

WaFd (WAFD) is back in focus after its October earnings release paired relatively steady profit figures with a sharp jump in fourth quarter net charge offs, a mix that tends to sharpen investor attention.

Recent trading tells a mixed story. WaFd shares have slipped about 6% over the past month and are down roughly 19% over the past quarter, even though the 1 year total shareholder return is positive at about 3%, and the 3 year total shareholder return is close to 35%.

Spot similar bank stocks where earnings resilience and credit risk are pulling in different directions by scanning our curated list of 30 resilient stocks with low risk scores.

That mix of resilient earnings and a sharp reset in credit costs is exactly what the recent drop in WaFd shares is forcing you to weigh. Are you seeing business fundamentals shift, or just sentiment repricing the risk?

Most Popular Narrative: 7% Undervalued

On Simply Wall St's most followed narrative, WaFd screens as modestly undervalued, with a fair value estimate of $31.75 against a last close of $29.47. This places recent price weakness against a model that still assigns some upside.

The Build 2030 shift toward true commercial banking and small business relationships, including reorganized business, corporate and commercial real estate banking teams, positions WaFd to grow higher yielding C&I and CRE loans, supporting faster revenue and earnings growth.

Ongoing runoff of low yielding single family mortgage loans and redeployment into higher yielding agency mortgage backed securities with no credit risk should structurally lift asset yields and net interest margin over time, improving net income.

See why 7 investors see WaFd as 7% undervalued.

Result: Fair Value of $31.75 (UNDERVALUED)

Still, the recent jump in net charge offs and the execution risk around the EverBank merger give you two clear reasons to question the WaFd upside story.

Find out about the key risks to this WaFd narrative.

Next Steps

That mix of optimism and caution does not have to dictate your stance. Act while the details are fresh and evaluate those bright spots for yourself with 5 key rewards.

Looking for more ideas beyond WaFd?

If WaFd has sharpened your thinking about risk, return and timing, do not stop here. Broaden your watchlist now before the next move passes you by.

• Target resilient balance sheets and steadier fundamentals by screening companies through our list of solid balance sheet and fundamentals (24 results).
• Hunt for mispriced quality where fundamentals and valuation line up using the curated 29 high quality undervalued stocks.
• Lock in potential income streams by reviewing companies in the high yield 5 dividend fortresses.

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