Paragon Banking Group (LON:PAG) Announces Quarterly Earnings Results

Paragon Banking Group (LON:PAG) posted its quarterly earnings data on Tuesday. The company reported GBX 52.10 earnings per share (EPS) for the quarter, Digital Look Earnings reports. Paragon Banking Group had a net margin of 21.40% and a return on equity of 12.75%. The company had revenue of £259.20 million for the quarter.

Here are the key takeaways from Paragon Banking Group’s conference call:

• Paragon delivered a strong first-half performance, with underlying operating profit of GBP 146 million, EPS up 2.9%, and return on tangible equity at 17.4%, supported by loan growth, tight cost control, and resilient margins.
• The company upgraded guidance, saying full-year net interest margin should be around 300 bps and cost guidance has also been raised despite a competitive funding environment and inflationary pressure.
• Paragon emphasized strong capital generation, generating CET1 at a 2.4% annualized rate in H1 and announcing a further GBP 50 million share buyback, while maintaining capital ratios above regulatory requirements.
• Loan growth remained solid, especially in commercial lending (+9.2%) and underlying buy-to-let growth (+6.7%), while the company continued to diversify funding through repo, covered bonds, and platform deposits.
• Impairments increased due mainly to the pre-September 2022 development finance cohort, and management acknowledged those workouts are taking longer than expected, though the rest of the portfolio was described as performing well.

Paragon Banking Group Trading Up 1.5%

Shares of PAG stock opened at GBX 745.50 on Wednesday. Paragon Banking Group has a 1 year low of GBX 681.50 and a 1 year high of GBX 981. The firm has a market capitalization of £1.38 billion, a PE ratio of 8.48, a price-to-earnings-growth ratio of 0.50 and a beta of 1.18. The stock has a fifty day moving average of GBX 753.86 and a two-hundred day moving average of GBX 813.16. The company has a debt-to-equity ratio of 120.17, a quick ratio of 1.48 and a current ratio of 0.28.

Analyst Upgrades and Downgrades

Several brokerages recently weighed in on PAG. Jefferies Financial Group reissued a “buy” rating and issued a GBX 1,000 price objective on shares of Paragon Banking Group in a report on Tuesday. Royal Bank Of Canada reissued an “outperform” rating and set a GBX 1,050 price target on shares of Paragon Banking Group in a report on Wednesday. Deutsche Bank Aktiengesellschaft reaffirmed a “buy” rating and issued a GBX 1,100 price objective on shares of Paragon Banking Group in a report on Wednesday. Finally, UBS Group reiterated a “buy” rating and issued a GBX 1,035 price objective on shares of Paragon Banking Group in a research report on Friday, May 29th. Six investment analysts have rated the stock with a Buy rating, Based on data from MarketBeat.com, the stock presently has an average rating of “Buy” and an average price target of GBX 1,040.17.

Insider Activity at Paragon Banking Group

In related news, insider Peter Hill acquired 382 shares of the business’s stock in a transaction that occurred on Wednesday, March 11th. The shares were acquired at an average cost of GBX 784 per share, for a total transaction of £2,994.88. Also, insider Richard Woodman sold 67,669 shares of the company’s stock in a transaction dated Tuesday, March 10th. The stock was sold at an average price of GBX 777, for a total transaction of £525,788.13. In the last three months, insiders acquired 2,751 shares of company stock valued at $2,184,450. 2.09% of the stock is owned by corporate insiders.

Paragon Banking Group Company Profile

Paragon is a specialist banking group. It offers a range of savings accounts and provide finance for landlords and small
and medium-sized businesses (‘SMEs’) and residential property developers in the UK. Founded in 1985 and listed on the
London Stock Exchange, it is a FTSE-250 company. Headquartered in Solihull, it employs more than 1,400 people.
Its operations are organised into two lending divisions and lending is funded largely by retail deposits.