Washington Federal (WAFD) Stock Forecast & Price Target

WaFd Inc. has demonstrated a positive financial trajectory, as evidenced by a 0.7% increase in tangible book value (TBV) to $27.93 and a 19 basis points rise in tangible common equity (TCE) to 8.34%. The company reported results that were approximately 4% better than expected, alongside a forecast for annualized expense improvement by the end of the second quarter, reflecting efficiency measures amounting to around 3.7% of projected expenses for 2026. Additionally, with a net interest margin (NIM) expected to benefit from cost relief in funding and an increased share buyback plan anticipated, WaFd is well-positioned for organic growth while optimizing shareholder value.

WaFd Inc has revised its fiscal 2025 and 2026 EPS projections downward to $2.48 and $2.95, respectively, due to lower net interest income (NII) and net interest margin (NIM), alongside rising loan loss provisions (LLPs) linked to a shift towards a commercial focus. The reported NII of $155 million fell short of expectations, impacted by a reduced balance sheet and unfavorable hedge valuation adjustments, while the NIM decreased by 23 basis points to 2.39%, reflecting lower yields on loans and securities. Increasing risks in the real estate market, including potential defaults and the impact of fluctuating interest rates, further contribute to a negative outlook for WaFd's stock performance.