NWBI
NWBI
Hold 2026-03-15
Model
DDM
Price at Report
$12.26
Base IV
$13.73
Bear IV
$11.39
Bull IV
$16.79
Entry Zone: 12-13 · Sell Above: 14
Bore Family Office
Valuation Report — Northwest Bancshares (NWBI) • March 15, 2026
3-Stage DDM (Ke) • Discount Rate: 8.15% • Current Price: $12.26
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
Northwest Bancshares, Inc. is a Pennsylvania-based community bank holding company operating through Northwest Bank, which provides personal and business banking, consumer and commercial lending, and wealth management services. With approximately $16.8 billion in assets following its late-2025 acquisition of Riverview Financial, NWBI is among the larger community banks in the mid-Atlantic and Great Lakes regions, serving customers across Pennsylvania, New York, Ohio, and Indiana.
NWBI's competitive position rests on its community banking model — relationship-driven lending, dense branch network in smaller markets, and a loyal retail deposit base — though it faces margin pressure from larger banks and credit union competition. The Riverview acquisition expands its Pennsylvania footprint and adds ~$2.3B in assets, but integration risk and higher provision expense weigh on near-term earnings.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Commercial Banking | $710M | 63% | +18.0% | — | Commercial loans, treasury mgmt |
| Personal Banking | $359M | 32% | +8.0% | — | Retail deposits, consumer lending |
| Wealth Management | $55M | 5% | +5.0% | — | Trust, brokerage, insurance |
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $941 | $924 | $962 | $934 | $1,124 |
| EBITDA ($M) | $7 | $6 | $25 | $21 | $142 |
| Operating Income ($M) | $201 | $174 | $175 | $130 | $163 |
| Net Income ($M) | $154 | $134 | $135 | $100 | $126 |
| EPS (diluted) | $1.21 | $1.05 | $1.06 | $0.79 | $0.92 |
| Free Cash Flow ($M) | $188 | $171 | $84 | $125 | $142 |
| Annual DPS | $0.800 | $0.800 | $0.800 | $0.800 | $0.800 |
| Total Debt ($M) | $253 | $243 | $244 | $244 | $245 |
| Rev YoY Growth | — | -1.8% | +4.2% | -3.0% | +20.4% |
| EBITDA Margin | 0.7% | 0.7% | 2.6% | 2.3% | 12.6% |
| Operating Margin | 21.4% | 18.8% | 18.2% | 13.9% | 14.5% |
| Net Margin | 16.4% | 14.5% | 14.0% | 10.7% | 11.2% |
📈 DDM Scenarios
$11
🔴 Bear
$14
📊 Base
$17
🚀 Bull
$12.26
Current Price
$14
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | Ke | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | 0.0% | 0.0% | 2.0% | 8.15% | $11 | ▼7.1% |
| 📊 Base | 2.0% | 1.5% | 2.5% | 8.15% | $14 | ▲12.0% |
| 🚀 Bull | 4.5% | 2.5% | 3.0% | 8.15% | $17 | ▲37.0% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: 0.0% | Stage 2: 0.0% | Terminal: 2.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.800 | $0.740 | $0.74 |
| Year 2 | Stage 1 | $0.800 | $0.684 | $1.42 |
| Year 3 | Stage 1 | $0.800 | $0.632 | $2.06 |
| Year 4 | Stage 1 | $0.800 | $0.585 | $2.64 |
| Year 5 | Stage 1 | $0.800 | $0.541 | $3.18 |
| Year 6 | Stage 2 | $0.800 | $0.500 | $3.68 |
| Year 7 | Stage 2 | $0.800 | $0.462 | $4.14 |
| Year 8 | Stage 2 | $0.800 | $0.427 | $4.57 |
| Year 9 | Stage 2 | $0.800 | $0.395 | $4.97 |
| Year 10 | Stage 2 | $0.800 | $0.365 | $5.33 |
| Terminal | — | TV=$13.27 | PV(TV)=$6.06 (53% of IV) |
Base Scenario
Stage 1: 2.0% | Stage 2: 1.5% | Terminal: 2.5%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.816 | $0.755 | $0.75 |
| Year 2 | Stage 1 | $0.832 | $0.712 | $1.47 |
| Year 3 | Stage 1 | $0.849 | $0.671 | $2.14 |
| Year 4 | Stage 1 | $0.866 | $0.633 | $2.77 |
| Year 5 | Stage 1 | $0.883 | $0.597 | $3.37 |
| Year 6 | Stage 2 | $0.897 | $0.560 | $3.93 |
| Year 7 | Stage 2 | $0.910 | $0.526 | $4.45 |
| Year 8 | Stage 2 | $0.924 | $0.493 | $4.95 |
| Year 9 | Stage 2 | $0.937 | $0.463 | $5.41 |
| Year 10 | Stage 2 | $0.952 | $0.435 | $5.84 |
| Terminal | — | TV=$17.26 | PV(TV)=$7.89 (57% of IV) |
Bull Scenario
Stage 1: 4.5% | Stage 2: 2.5% | Terminal: 3.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.836 | $0.773 | $0.77 |
| Year 2 | Stage 1 | $0.874 | $0.747 | $1.52 |
| Year 3 | Stage 1 | $0.913 | $0.722 | $2.24 |
| Year 4 | Stage 1 | $0.954 | $0.697 | $2.94 |
| Year 5 | Stage 1 | $0.997 | $0.674 | $3.61 |
| Year 6 | Stage 2 | $1.022 | $0.639 | $4.25 |
| Year 7 | Stage 2 | $1.047 | $0.605 | $4.86 |
| Year 8 | Stage 2 | $1.074 | $0.574 | $5.43 |
| Year 9 | Stage 2 | $1.100 | $0.544 | $5.97 |
| Year 10 | Stage 2 | $1.128 | $0.515 | $6.49 |
| Terminal | — | TV=$22.56 | PV(TV)=$10.31 (61% of IV) |
🔲 Sensitivity Table
| Ke \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 6.1% | $18 | $20 | $21 | $24 | $27 |
| 6.7% | $16 | $17 | $18 | $20 | $22 |
| 7.2% | $15 | $15 | $16 | $18 | $19 |
| 7.6% | $14 | $14 | $15 | $16 | $18 |
| 8.2% | $12 | $13 | $14 | $14 | $15 |
| 8.7% | $12 | $12 | $13 | $13 | $14 |
| 9.1% | $11 | $11 | $12 | $12 | $13 |
| 9.7% | $10 | $10 | $11 | $11 | $12 |
| 10.2% | $10 | $10 | $10 | $10 | $11 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Company | P/E | P/TBV | Yield | NIM Est. |
|---|---|---|---|---|
| NWBI (Current) | 13.3x | 1.19x | 6.5% | 3.8% |
| FULT (Fulton Financial) | 11.2x | 1.50x | 3.8% | 3.5% |
| CBSH (Commerce Bancshares) | 14.5x | 2.10x | 1.9% | 4.0% |
| WSBC (WesBanco) | 11.8x | 1.15x | 4.5% | 3.6% |
| FFBC (First Finl Bancorp) | 10.9x | 1.40x | 3.7% | 4.1% |
| Community Bank Avg | 12.6x | 1.54x | 3.5% | 3.8% |
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $0.800 |
| Current Yield | 6.53% |
| Consecutive Growth Years | 0 |
| 1-yr DPS CAGR | +0.0% |
| 3-yr DPS CAGR | +0.0% |
| 5-yr DPS CAGR | +0.0% |
| 10-yr DPS CAGR | — |
| Payout Ratio (DPS/EPS) | 87.0% ⚠️ |
| FCF Payout Ratio | 76.9% |
| Sustainability Verdict | Watch |
Payout ratio of 87% EPS is elevated but FCF coverage is adequate (~$1.04 FCF/share vs. $0.80 DPS). The flat dividend since 2018 reflects balance sheet caution. As EPS recovers toward $1.33 in 2026, payout ratio normalizes to ~60% — supporting sustainability. Downgrade to "At Risk" if provisions spike or NIM compresses significantly.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $1.21 | — | — | — | Actual |
| 2022 | $1.05 | — | — | — | Actual |
| 2023 | $1.06 | — | — | — | Actual |
| 2024 | $0.79 | — | — | — | Actual |
| 2025 | $0.92 | — | — | — | Actual |
| 2026 | $1.20 | $1.33 | $1.42 | 10 | Estimate |
| 2027 | $1.33 | $1.45 | $1.60 | 10 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $549.9B | — | — | — | Actual |
| 2022 | $503.2B | — | — | — | Actual |
| 2023 | $526.6B | — | — | — | Actual |
| 2024 | $498.1B | — | — | — | Actual |
| 2025 | $599.1B | — | — | — | Actual |
| 2026 | $566.8B | $636.8B | $754.0B | 10 | Estimate |
| 2027 | $595.0B | $669.0B | $809.2B | 10 | Estimate |
(c) Individual Analyst Price Targets
Consensus: Avg $13.67 | Range $13–$15
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Michael Ciarmoli | Truist Securities | Strong Buy | $15 | +22.3% |
| Timothy Switzer | KBW | Hold | $15 | +22.3% |
| Jeff Rulis | DA Davidson | Hold | $13 | +6.0% |
| Manuel Navas | Piper Sandler | Hold | $13 | +6.0% |
(d) Earnings Surprise History
| Quarter | EPS Act vs Est | EPS Beat/Miss | Rev Act vs Est | Rev Beat/Miss | Guidance |
|---|---|---|---|---|---|
| Q4 2025 | $0.25 vs $0.24 | +$0.01 ✅ | $310.0B vs $300.0B | +$10.0B ✅ | No change |
| Q3 2025 | $0.23 vs $0.22 | +$0.01 ✅ | $295.0B vs $287.0B | +$8.0B ✅ | No change |
| Q2 2025 | $0.22 vs $0.21 | +$0.01 ✅ | $278.0B vs $272.0B | +$6.0B ✅ | No change |
| Q1 2025 | $0.22 vs $0.21 | +$0.01 ✅ | $241.0B vs $235.0B | +$6.0B ✅ | Acquisition integration |
(e) Confidence Band Commentary
Only 3 active analysts cover NWBI — the estimate range is moderately wide (+20% from low to high). The stock is a consistent EPS beater vs. modest consensus estimates. The large FY2026 EPS jump (44% to $1.33) reflects integration synergy timing — if Riverview integration slips, estimates will come down. Wide revenue range ($566M–$754M) reflects integration uncertainty. The strong buy from Truist reflects re-rating potential from current sub-book valuations.
💡 Investment Thesis
- Deep value on book: NWBI trades at 0.88× book value and 1.19× TBV — meaningful discount to community bank peers trading at 1.2–1.5× TBV. Strong floor support.
- EPS recovery story: Analyst consensus sees EPS jumping 44% to $1.33 in FY2026 (from $0.92 in FY2025), driven by Riverview cost synergies and NIM expansion as higher-rate assets reprice. Payout ratio falls from 87% to ~60%.
- Fat yield with room to grow: 6.5% dividend yield is well-covered by projected FCF/share of ~$1.04. As EPS normalizes above $1.30, dividend growth becomes increasingly likely — a potential re-rating catalyst.
- Acquisition adds scale: The Riverview deal (closed late 2025) adds $2.3B in assets and expands Pennsylvania coverage. Management targets ~$12M in cost saves by year 2, improving efficiency ratio from the current 74%.
- Rate tailwind: NWBI is moderately asset-sensitive — a pause in Fed rate cuts benefits NIM, which already expanded in 2025 as funding costs rolled over.
⚖️ DDM Verdict: Hold — Northwest Bancshares (NWBI)
Current price: $12.26 | Analyst Avg PT: $13.67
$11
🔴 Bear
$14
📊 Base
$17
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$13 | Begin position |
| Tier 2 — Add | ≤$13 | Add on weakness |
| Tier 3 — Full | ≤$12 | Full allocation |
| Sell Alert | ≥$14 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Initiate at Accumulate with a Base intrinsic value of ~$11.35 and a near-term price target of $13.67 (analyst consensus). At $12.26, the stock offers a 6.5% yield with a credible path to dividend growth as EPS recovers post-acquisition.
Add to the existing position on weakness below $12.00 (near TBV of $10.32 provides strong downside anchor). Becomes a Hold above $14.50 (1.05× book), where the yield thesis moderates.
📂 Current Position Summary
| Metric | Value |
|---|---|
| Shares Held | 647.84 |
| Average Cost Basis | $13.73 |
| Current Market Value | $7,943 |
| Unrealized P&L | $-952 (-10.7%) |
| Annual DPS | $0.800/yr |
| Annual Dividend Income | $518/yr |
| Current Yield (at price) | 6.53% |
| Yield on Cost | 5.83% |
| vs Target (~$200K) | $7,943 / $200,000 (4%) |
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Model Choice | DDM (3-stage) chosen for community bank with explicit dividend policy ($0.80/yr flat since 2018). High payout ratio (87% EPS, 77% FCF) makes dividend the primary equity cash flow. |
| Ke Build | Ke = 4.30% (10yr Treasury) + 0.70 (beta, community bank low-vol) × 5.50% (ERP) = 8.15%. Community banks typically have β 0.60–0.85. |
| DPS Base | Using $0.80 annual DPS as base (no growth for 8+ years). Bear case holds flat. Base/Bull assume EPS recovery enables modest growth as payout normalizes. |
| Sanity Check | Base IV ~$13.73 is near analyst PT of $13.67 (+0.4%). DDM captures dividend income stream; P/BV cross-check (0.88x BV $13.87 = $12.21) aligns with market price. Models converging suggests fair valuation range is $12–14. |
| Riverview Acquisition | NWBI acquired Riverview Financial in late 2025, adding ~$2.3B assets and ~8M shares. FY2025 shows revenue jump to $1.12B (from $934M). Integration costs and higher provisions weigh on near-term EPS. Synergies expected to materialize by 2027. |
| Terminal Growth | gT range 2.0–3.0%. Community bank revenue tied to regional economy — limited pricing power beyond nominal GDP. 2.5% Base justified by demographic stability in NWBI markets (PA/NY/OH/IN). |
Bore Family Office • Analysis generated by Lurch • Not investment advice.