Eastern Bankshares, Inc. (EBC) | Investment Case

1. Company Snapshot

1.a. Company Description

Eastern Bankshares, Inc.operates as the bank holding company for Eastern Bank that provides banking products and services primarily to retail, commercial, and small business customers.It operates in two segments, Banking Business and Insurance Agency Business.

The company provides interest-bearing and non interest-bearing checking deposits, money market deposits, savings deposits, and time certificates of deposits, as well as debit and credit cards.It also offers commercial and industrial loans, commercial real estate and construction loans, small business loans, residential real estate loans, home equity, and lines of credit, as well as other consumer loans comprising unsecured personal lines of credit, overdraft protection, automobile loans, home improvement loans, airplane loans, and other personal loans.In addition, the company provides cash reserves, cash management, merchant, escrow express, government banking, international banking, interest on lawyers trust accounts, retirement planning, and business telephone banking services, as well as products and services for not-for-profit and healthcare.

Further, it offers trust and investment products and services; community development and asset-based lending services; financial planning, portfolio management, wealth management, private banking, and fiduciary products; online, mobile, and telephone banking services; and automated lock box collection and account reconciliation services, as well as various insurance products.As of December 31, 2021, the company operated 105 branch offices in eastern Massachusetts and southern New Hampshire; and 23 non-branch offices in eastern Massachusetts, one office in New Hampshire, and one office in Rhode Island.Eastern Bankshares, Inc.

was founded in 1818 and is headquartered in Boston, Massachusetts.

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1.b. Last Insights on EBC

Eastern Bankshares, Inc.'s recent performance has been positively driven by several factors. The company's completion of its acquisition of HarborOne Bancorp, Inc. in November 2025, has expanded its presence and capabilities. Additionally, Eastern Bank boosted its position in Eastern Bankshares by 6.2% during Q3, demonstrating confidence in the company's prospects. The bank also announced new commercial banking customers, such as Owen Security Solutions, and welcomed Jarrad Herzog as Senior Vice President, Asset-Based Lending Relationship Manager, enhancing its lending capabilities. Furthermore, the company is set to release its Q4 2025 earnings, which may provide further insight into its performance.

1.c. Company Highlights

Last Price	21.42
Change Percentage	1.47%
Open	21.11
Previous Close	21.11
Market Cap ( Millions)	4818
Volume	1421577
Year High	22.57
Year Low	13.51
M A 50	19.98
M A 200	17.47

FCF Yield	8.23%
Dividend Yield	2.38%
ROE	2.29%
Debt / Equity	4.95%
Net Debt / EBIDTA	56.52%
Price To Book	1.06
Price Earnings Ratio	52.26
Price To FCF	12.15
Price To sales	4.56
EV / EBITDA	31.23

2. Eastern Bankshares' 2025 Earnings: A Strong Finish with Promising Outlook

Eastern Bankshares reported a net income of $99.5 million or $0.44 per diluted share in Q4 2025, beating analyst estimates of $0.41. Operating earnings were $94.7 million, up 28% linked quarter, driven by a significant increase in net interest income to $237.4 million. The company's operating ROA was 130 basis points, and return on average tangible common equity was 13.8%. The net interest margin improvement was a key driver, with the company citing margin expansion as a major contributor to the increase in net interest income.

Publication Date: Feb -12

                                    📋 Highlights
                                    Operating Earnings Surge:
                                                Operating earnings rose 62% in 2025, with Q4 2025 operating earnings of $94.7M, up 28% from Q3 2025.
Merger-Driven Scale:
                                                Post-HarborOne merger, Eastern became Massachusetts’ largest independent bank with $31B in assets and 4th-largest deposit market share in Greater Boston.
Strong Capital Position:
                                                CET1 ratio at 13.2% and TCE at 10.4%, supporting $55.4M in Q4 share repurchases and a $0.13 quarterly dividend approval.
Net Interest Income Growth:
                                                Q4 2025 net interest income hit $237.4M, up $37.2M from Q3, with full-year 2026 guidance of $1.2B–$1.5B and 3.65%–3.75% FTE margin.
Nonperforming Loan Resolution:
                                                NPLs increased $103M linked-quarter, mostly from HarborOne, expected to resolve by mid-2026, with 2026 provision expense guided at $30M–$40M.

                                

Segment Performance

The wealth management business had a record high of $10.1 billion in assets, with $9.6 billion in assets under management. Noninterest income was $46.1 million, up $4.8 million from Q3, driven by mortgage banking income and investment advisory fees. The company's asset quality remains excellent, with net charge-offs to average total loans of 18 basis points.

Capital Position and Share Repurchases

Eastern's capital position remains strong, with CET1 and TCE ratios of 13.2% and 10.4%, respectively. The company repurchased 3.1 million shares for $55.4 million in Q4 and has repurchased an additional 635,000 shares in 2026. The Board approved a $0.13 dividend for the first quarter, indicating a continued focus on returning capital to shareholders.

2026 Outlook

The company's 2026 outlook focuses on organic growth and returning excess capital to shareholders. Eastern expects loan growth of 3% to 5% and deposit growth of 1% to 2%. Net interest income is expected to be in the range of $1.20 billion to $1.50 billion with a full-year FTE margin of 3.65% to 3.75%. The company plans to manage its CET1 ratio towards the median of the KRX, which is currently 12%. With a P/TBV ratio of 1.07, the stock appears reasonably valued. The dividend yield of 2.37% is attractive, especially considering the company's commitment to returning capital to shareholders.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 4.5%. Given the company's strong capital position and focus on organic growth, it is well-positioned to achieve this growth rate. The stock's current valuation multiples, including a P/E ratio of 52.5, suggest that the market has high expectations for the company's future performance. As Eastern Bankshares continues to execute on its strategy, investors will be watching to see if the company can deliver on its promises and drive long-term value creation.

3. NewsRoom

Eastern Bank Earns Top Score For 12th Consecutive Year In Human Rights Campaign Foundation's 2026 Corporate Equality Index

Feb -19

Source: businesswire.com

Eastern Bankshares (NASDAQ:EBC) vs. Potomac Bancshares (OTCMKTS:PTBS) Critical Comparison

Feb -17

Source: defenseworld.net

Eastern Bank Provides Financing To Support BostonbeaN Coffee Company's Transition To Employee Ownership

Feb -12

Source: businesswire.com

Brokerages Set Eastern Bankshares, Inc. (NASDAQ:EBC) Target Price at $22.13

Feb -08

Source: defenseworld.net

Eastern Bankshares Chief Information Officer Sells 21,000 Shares for $427,000

Feb -06

Source: fool.com

Eastern Bank Provides $15.5 Million Affordable Housing Construction Loan For Causeway Development

Jan -29

Source: businesswire.com

Eastern Bankshares Q4 Earnings Call Highlights

Jan -25

Source: defenseworld.net

Eastern Bankshares, Inc. (EBC) Q4 2025 Earnings Call Transcript

Jan -23

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.40%)

6. Segments

Banking

Expected Growth: 7.4%

Eastern Bankshares, Inc.'s 7.4% growth is driven by strategic acquisitions, expanding commercial lending, and a strong deposit base. The bank's focus on digital transformation, cost savings initiatives, and a favorable interest rate environment also contribute to its growth. Additionally, the bank's diverse revenue streams, including fee income and mortgage banking, support its overall growth momentum.

7. Detailed Products

Consumer Banking

Eastern Bankshares, Inc. offers a range of consumer banking products and services, including checking and savings accounts, credit cards, personal loans, and mortgages.

Commercial Banking

The company provides commercial banking services, including cash management, commercial lending, and trade finance, to businesses of all sizes.

Wealth Management

Eastern Bankshares, Inc. offers wealth management services, including investment management, trust services, and financial planning, to individuals, families, and institutions.

Insurance

The company offers a range of insurance products, including life insurance, disability insurance, and long-term care insurance, to individuals and businesses.

8. Eastern Bankshares, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Eastern Bankshares, Inc. operates in a highly competitive industry, with many substitutes available to customers. However, the company's strong brand recognition and customer loyalty help to mitigate the threat of substitutes.

Bargaining Power Of Customers

Eastern Bankshares, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong relationships with its customers help to reduce the threat of customer bargaining power.

Bargaining Power Of Suppliers

Eastern Bankshares, Inc. relies on a few large suppliers for its operations, which gives them some bargaining power. However, the company's strong relationships with its suppliers and its ability to negotiate favorable terms help to mitigate this threat.

Threat Of New Entrants

The banking industry has high barriers to entry, including regulatory hurdles and significant capital requirements. This makes it difficult for new entrants to enter the market, reducing the threat of new entrants to Eastern Bankshares, Inc.

Intensity Of Rivalry

The banking industry is highly competitive, with many established players competing for market share. Eastern Bankshares, Inc. faces intense competition from other banks and financial institutions, which can make it difficult to attract and retain customers.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	1.60%
Debt Cost	8.32%
Equity Weight	98.40%
Equity Cost	8.32%
WACC	8.32%
Leverage	1.62%

11. Quality Control: Eastern Bankshares, Inc. passed 6 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Wintrust Financial

A-Score: 6.2/10

Value: 6.7

Growth: 6.9

Quality: 7.2

Yield: 4.0

Momentum: 5.0

Volatility: 7.3

1-Year Total Return ->

Atlantic Union Bankshares

A-Score: 5.9/10

Value: 6.2

Growth: 5.2

Quality: 7.0

Yield: 8.0

Momentum: 2.5

Volatility: 6.7

1-Year Total Return ->

Ameris

A-Score: 5.5/10

Value: 3.2

Growth: 7.8

Quality: 5.7

Yield: 2.0

Momentum: 7.0

Volatility: 7.3

1-Year Total Return ->

SouthState

A-Score: 5.5/10

Value: 5.3

Growth: 5.4

Quality: 6.9

Yield: 5.0

Momentum: 2.5

Volatility: 7.7

1-Year Total Return ->

UMB

A-Score: 5.4/10

Value: 5.9

Growth: 5.8

Quality: 6.3

Yield: 4.0

Momentum: 3.5

Volatility: 7.0

1-Year Total Return ->

Eastern Bank

A-Score: 5.4/10

Value: 3.8

Growth: 5.8

Quality: 6.1

Yield: 5.0

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

0.65%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.32%

Eastern Bankshares, Inc. - US27627N1054

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on EBC

1.c. Company Highlights

Better Quality

Average Growth

Medium Volatility

Earnings Beats

Revenues Beats

Stable Momentum

Fairly Valued

Earnings Miss

Revenues Miss

Average Quality

Expensive

Lower Quality

2. Eastern Bankshares' 2025 Earnings: A Strong Finish with Promising Outlook

Segment Performance

Capital Position and Share Repurchases

2026 Outlook

Valuation and Growth Prospects

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.40%)

6. Segments

Banking

Expected Growth: 7.4%

7. Detailed Products

Consumer Banking

Commercial Banking

Wealth Management

Insurance

8. Eastern Bankshares, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Eastern Bankshares, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

21.42$

Current Price

21.42$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA