Regional bank Washington Trust Bancorp (NASDAQ: WASH) reported revenue ahead of Wall Streets expectations in Q3 CY2025, with sales up 16.2% year on year to $56.69 million. Its non-GAAP profit of $0.56 per share was 20.6% above analysts’ consensus estimates.
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Washington Trust Bancorp (WASH) Q3 CY2025 Highlights:
- Net Interest Income: $38.83 million vs analyst estimates of $38.5 million (20.4% year-on-year growth, 0.9% beat)
- Net Interest Margin: 2.4% vs analyst estimates of 2.4% (in line)
- Revenue: $56.69 million vs analyst estimates of $55.52 million (16.2% year-on-year growth, 2.1% beat)
- Adjusted EPS: $0.56 vs analyst estimates of $0.46 (20.6% beat)
- Tangible Book Value per Share: $24.39 vs analyst estimates of $23.95 (4.4% year-on-year decline, 1.9% beat)
- Market Capitalization: $549 million
Company Overview
Founded in 1800 and operating as Rhode Island's oldest community bank, Washington Trust Bancorp (NASDAQ: WASH) is a regional bank holding company offering commercial banking, mortgage lending, personal banking, and wealth management services.
Sales Growth
Two primary revenue streams drive bank earnings. While net interest income, which is earned by charging higher rates on loans than paid on deposits, forms the foundation, fee-based services across banking, credit, wealth management, and trading operations provide additional income. Unfortunately, Washington Trust Bancorp struggled to consistently increase demand as its $212.7 million of revenue for the trailing 12 months was close to its revenue five years ago. This was below our standards and is a sign of poor business quality.
We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Washington Trust Bancorp’s annualized revenue growth of 2.3% over the last two years is above its five-year trend, but we were still disappointed by the results. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
This quarter, Washington Trust Bancorp reported year-on-year revenue growth of 16.2%, and its $56.69 million of revenue exceeded Wall Street’s estimates by 2.1%.
Net interest income made up 66.9% of the company’s total revenue during the last five years, meaning lending operations are Washington Trust Bancorp’s largest source of revenue.
While banks generate revenue from multiple sources, investors view net interest income as the cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of non-interest income.
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Tangible Book Value Per Share (TBVPS)
Banks operate as balance sheet businesses, with profits generated through borrowing and lending activities. Valuations reflect this reality, emphasizing balance sheet strength and long-term book value compounding ability.
When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. Traditional metrics like EPS are helpful but face distortion from M&A activity and loan loss accounting rules.
Washington Trust Bancorp’s TBVPS declined at a 1.6% annual clip over the last five years. However, TBVPS growth has accelerated recently, growing by 6.9% annually over the last two years from $21.36 to $24.39 per share.
Over the next 12 months, Consensus estimates call for Washington Trust Bancorp’s TBVPS to grow by 5% to $25.62, lousy growth rate.
Key Takeaways from Washington Trust Bancorp’s Q3 Results
It was good to see Washington Trust Bancorp beat analysts’ EPS expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. Zooming out, we think this was a solid print. The stock remained flat at $28.85 immediately after reporting.
Is Washington Trust Bancorp an attractive investment opportunity at the current price? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.
