3. Webster Financial Corporation (NYSE:WBS)
Number of Hedge Fund Holders: 42
Market Capitalization as of October 28, 2024: $8.93 Billion
Forward P/E as of October 28, 2024: 9.77
Webster Financial Corporation (NYSE:WBS) ranks third on our list of the best mid-cap value stocks to invest in. The commercial banking corporation is headquartered in Connecticut, United States. The company offers a range of services including personal banking, business banking, wealth management, and commercial banking services.
The company boasts a thorough network of more than 200 banking centers across Connecticut, Massachusetts, Rhode Island, and the New York Metro area. The banking centers are home to 24-hour ATMs, offer notary and safe deposit services, and have relationship managers to assist customers.
Earlier this year in January, the company closed the acquisition of Ametros Financial Corporation. Following the transition, the business continues to operate under the brand names, Ametros and CareGuard. Ametros is one of the largest administrators of medical insurance claim settlements. Consequently, clients make use of the CareGuard platform to manage their existing medical care. The acquisition helped Webster Financial Corporation (NYSE:WBS) enhance its position as a growing source of affordable and long-term deposits.
Webster Financial Corporation (NYSE:WBS) is an investor favorite because of its expansion initiatives and strong financial performance. In the third quarter of 2024, the company generated $647.6 million in revenue, a solid feat amid a challenging economic backdrop. Quarterly net interest income reached $589.9 million, up from $587.1 million in Q3 2023. Additionally, average interest-earnings assets totaled $69.8 billion, up by 4% year-over-year. Overall, 42 hedge funds were bullish on the stock at the close of Q2 2024, according to the Insider Monkey database.
Diamond Hill Capital’s Diamond Hill Select Strategy stated the following regarding Webster Financial Corporation (NYSE:WBS) in its first quarter 2024 investor letter:
“Among our bottom Q1 contributors were Humana, Extra Space Storage and Webster Financial Corporation (NYSE:WBS). Self-storage real estate investment trust (REIT) Extra Space Storage and HSA-focused bank Webster Financial performed well at the end of 2023 as investors anticipated interest rate cuts and easier financial conditions in 2024. As this sentiment largely reversed in early 2024 against a resilient economic backdrop and still-elevated interest rates, real estate (and REITs broadly) and banks were pressured in Q1 (though it’s worth noting Webster Financial shares were modestly positive in the quarter). However, we believe Extra Space Storage has a high-quality, long-term franchise with an industry-leading operating platform that should position it well in the future. Similarly, we believe Webster Financial’s large HSA account platform and diverse deposit base is a strong competitive advantage in the current macroeconomic environment.”
