Zions Bancorporation National Association (ZION) AI Stock Analysis

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Zions Bancorporation National Association

(NASDAQ:ZION)

71Outperform

Zions Bancorporation's stock is bolstered by strong financial performance and a positive earnings call outlook, highlighting revenue growth and profitability improvements. Despite a bearish technical analysis and leverage concerns, the stock appears undervalued with an attractive dividend yield, making it a potentially appealing investment.

Positive Factors

Financial Performance

Zions reported a 3Q EPS of $1.37, which was 19 cents above consensus, driven by better-than-expected net interest income and well-managed expenses.

Regulatory Environment

The change in regulatory leadership suggests potential positive shifts in regulation, which could benefit Zions.

Technology Upgrade

Zions' tech transformation is complete, positioning the company well for potential acquisitions.

Negative Factors

Capital Management

Share repurchases are on hold until more clarity is achieved on capital rules, indicating some caution in capital management.

Credit Metrics

Credit metrics were mixed as net charge-offs declined, but NPAs, classified, and criticized loans all increased sequentially.

Loan Growth

Loan growth remains uncertain with guidance for 'stable to slightly increasing' loan growth unchanged.

Zions Bancorporation National Association (ZION) vs. S&P 500 (SPY)

Market Cap

$6.11B

Dividend Yield4.06%

Average Volume (3M)2.15M

Price to Earnings (P/E)8.4

Beta (1Y)1.76

Revenue Growth7.91%

EPS Growth13.79%

CountryUS

Employees9,406

SectorFinancial

Sector Strength81

IndustryBanks - Regional

Share Statistics

EPS (TTM)4.96

Shares Outstanding147,563,310

10 Day Avg. Volume1,715,101

30 Day Avg. Volume2,149,324

Financial Highlights & Ratios

PEG Ratio0.61

Price to Book (P/B)N/A

Price to Sales (P/S)2.34

Price to Cash Flow (P/CF)3.50

P/FCF Ratio1.90

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$61.17

Price Target Upside43.42% Upside

Rating ConsensusHold

Number of Analyst Covering13

Zions Bancorporation National Association Business Overview & Revenue Model

Company DescriptionZions Bancorporation, National Association provides various banking and related services primarily in the states of Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington, and Wyoming. The company offers corporate banking services; commercial banking, including a focus on small- and medium-sized businesses; commercial real estate banking services; municipal and public finance services; retail banking, including residential mortgages; trust services; wealth management and private client banking services; and capital markets products and services. As of December 31, 2020, it operated 422 branches, which included 273 owned and 149 leased. The company was formerly known as ZB, National Association and changed its name to Zions Bancorporation, National Association in September 2018. Zions Bancorporation, National Association was founded in 1873 and is headquartered in Salt Lake City, Utah.

How the Company Makes MoneyZions Bancorporation generates revenue primarily through interest income and non-interest income sources. Interest income is derived from the loans and credit products it offers to individuals and businesses. This includes personal loans, commercial loans, mortgages, and lines of credit. Non-interest income comes from fees and service charges associated with deposit accounts, transaction processing, and wealth management services. Additionally, investment banking and advisory fees contribute to its earnings. Zions also benefits from strategic partnerships with financial technology firms and other financial institutions, which enhance its service offerings and customer reach. The company's performance is influenced by factors such as interest rate fluctuations, economic conditions, and regulatory changes.

Zions Bancorporation National Association Financial Statement Overview

Summary

Zions Bancorporation demonstrates strong revenue and profit growth, with a significant increase in revenue and improved net profit and EBIT margins. The balance sheet is healthy but shows some leverage concerns, while cash flow management is efficient despite fluctuations.

Income Statement

Very Positive

Zions Bancorporation has shown solid revenue growth, with a significant increase from $2.705 billion in 2023 to $4.293 billion in 2024. The net profit margin improved to 18.26% in 2024, up from 25.14% in 2023, indicating strong profitability. The EBIT margin was exceptionally high at 98.95%, reflecting efficient cost management. However, the EBITDA margin decreased slightly, highlighting potential operational challenges.

Balance Sheet

Positive

The company's balance sheet shows a moderate debt-to-equity ratio of 0.78, which is manageable. The return on equity improved to 12.81%, reflecting enhanced profitability. However, the equity ratio stands at 6.90%, indicating a high level of leverage, which could pose risks in adverse conditions.

Cash Flow

Positive

Operating cash flow improved significantly to $1.47 billion in 2024, a positive indicator of cash-generating ability. Free cash flow also increased, with a free cash flow to net income ratio of 1.88, suggesting efficient cash conversion. However, the overall cash flow situation exhibited fluctuations, with substantial financing cash outflows.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
4.29B	2.71B	3.34B	2.91B	2.79B
	Gross Profit
4.29B	2.71B	3.34B	2.91B	2.79B
	EBIT
1.01B	1.05B	1.34B	1.45B	672.00M
	EBITDA
1.01B	1.03B	1.26B	1.43B	758.00M
	Net Income Common Stockholders
784.00M	680.00M	907.00M	1.13B	539.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
9.13B	2.25B	2.46B	11.25B	1.88B
	Total Assets
88.78B	87.20B	89.55B	93.20B	81.48B
	Total Debt
4.78B	2.07B	7.75B	1.01B	1.34B
	Net Debt
4.78B	-137.00M	5.75B	-9.87B	-281.00M
	Total Liabilities
82.65B	81.51B	84.65B	85.74B	73.59B
	Stockholders Equity
6.12B	5.69B	4.89B	7.46B	7.89B
Cash Flow		Free Cash Flow
1.47B	772.00M	1.28B	423.00M	548.00M
	Operating Cash Flow
1.47B	885.00M	1.47B	629.00M	719.00M
	Investing Cash Flow
1.41B	2.37B	1.41B	-11.58B	-12.20B
	Financing Cash Flow
-2.81B	-3.20B	-2.81B	11.00B	11.32B

Zions Bancorporation National Association Technical Analysis

Technical Analysis Sentiment

Negative

Last Price42.65

Price Trends

50DMA

52.15

Negative

100DMA

54.58

Negative

200DMA

50.86

Negative

Market Momentum

MACD

-0.79

Negative

RSI

42.80

Neutral

STOCH

39.81

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZION, the sentiment is Negative. The current price of 42.65 is below the 20-day moving average (MA) of 48.32, below the 50-day MA of 52.15, and below the 200-day MA of 50.86, indicating a bearish trend. The MACD of -0.79 indicates Negative momentum. The RSI at 42.80 is Neutral, neither overbought nor oversold. The STOCH value of 39.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ZION.

Zions Bancorporation National Association Risk Analysis

Zions Bancorporation National Association disclosed 36 risk factors in its most recent earnings report. Zions Bancorporation National Association reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Zions Bancorporation National Association Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UMBF	74 Outperform	$6.31B	9.66	13.44%	1.82%	17.28%	25.42%
PB	72 Outperform	$6.14B	12.77	6.60%	3.54%	11.96%	11.66%
ZION	71 Outperform	$6.11B	8.36	13.15%	4.06%	7.91%	13.79%
WTFC	68 Neutral	$6.42B	9.34	11.84%	1.92%	11.51%	7.73%
BOKF	68 Neutral	$5.78B	11.05	9.70%	2.49%	11.17%	1.47%
BPOP	65 Neutral	$5.72B	9.64	11.42%	3.20%	13.68%	13.73%
Sector *	63 Neutral	$12.88B	9.21	9.18%	4.78%	16.30%	-8.66%

* Financial Sector Average

Performance Comparison

ZION

Zions Bancorporation National Association

42.65

1.07

2.57%

BOKF

Bok Financial

88.76

-0.43

-0.48%

BPOP

Popular

81.84

-1.66

-1.99%

Prosperity Bancshares

63.99

1.82

2.93%

UMBF

UMB Financial

86.61

3.69

4.45%

WTFC

Wintrust Financial

95.89

-3.90

-3.91%

Zions Bancorporation National Association Earnings Call Summary

Earnings Call Date: Jan 21, 2025 | % Change Since: -27.18% | Next Earnings Date: Apr 21, 2025

Earnings Call Sentiment Neutral

The call presented a balanced view with significant improvements in financial performance, net interest margin expansion, and capital markets success. However, there were challenges with increased net loan losses, a rise in classified loan balances, and higher noninterest expenses.

Highlights

Improved Financial Performance

Fourth quarter adjusted pre-provision net revenue increased by 19% relative to the prior year quarter. Net earnings for the year were $737 million or $4.95 per share.

Net Interest Margin Expansion

The net interest margin expanded for the fourth consecutive quarter to 3.05%, compared to 3.03% in the prior quarter and 2.91% in the year ago quarter.

Capital Markets Success

The Capital Markets business experienced strong results, with a 36% increase for the full year compared to 2023.

Customer Deposit Growth

Customer deposits increased on both an ending and average basis in the fourth quarter and the full year, with stability in noninterest-bearing demand deposits.

Strong Loan Growth Outlook

Average loan growth was modest at 1.1% on a linked-quarter basis and 3.2% for the full year, with expectations for continued growth in 2025.

Lowlights

Increased Net Loan Losses

Net loan losses were higher in the quarter at $36 million or 24 basis points annualized, primarily due to a single commercial and industrial credit.

Rise in Classified Loan Balances

The level of classified balances increased by $777 million, primarily in commercial real estate, although nonaccrual loans decreased by 18%.

Provision for Credit Losses

Provision for credit losses this quarter of $41 million had a negative impact of $0.21 per share.

Increased Noninterest Expenses

Adjusted noninterest expense increased $10 million to $509 million, due to increases in compensation-related accruals, legal services, and occupancy.

Company Guidance

During the Zions Bancorporation Q4 2024 earnings call, the company provided guidance that included several key financial metrics and expectations for 2025. They reported a 19% increase in adjusted pre-provision net revenue for the fourth quarter compared to the prior year, with net earnings for the year at $737 million or $4.95 per share. The net interest margin expanded to 3.05%, marking the fourth consecutive quarter of improvement. The efficiency ratio improved by 62%, and customer deposits increased on both an ending and average basis. Looking ahead to 2025, Zions anticipates continued improvement in profitability measures, with positive operating leverage and moderately increasing net interest income. They project a slight increase in period-end loan balances, driven by commercial loans, with a focus on disciplined expense management despite inflationary pressures.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.