Waterstone Financial, Inc. (WSBF) AI Stock Analysis

Waterstone Financial, Inc., operating primarily through its subsidiary WaterStone Bank SSB, serves as a bank holding company catering to southeastern Wisconsin. Organized into two segments, Community Banking and Mortgage Banking, the firm provides retail and business financial services. In Community Banking, offerings include checking accounts, deposits, credit cards, mortgages, personal loans, investment services, annuities, insurance products, and trust management. Its Mortgage Banking segment originates residential mortgage loans for subsequent sale in the secondary market, utilizing expertise in mortgage-backed securities and other debt instruments. Headquartered in Wauwatosa, Wisconsin, the company was established in 1921.

Between FY2021 and FY2025, revenue contracted at a 5-year CAGR of -8.7%, dropping from $268.5M in FY2021 to $171.1M in FY2022 before recovering to $199.4M in FY2024 and $201.6M in FY2025. Annual net income troughed at $9.4M in FY2023 but rebounded to $26.4M in FY2025, lifting diluted EPS to $1.49. Gross margin stood at 71.2% in FY2025, while operating margin rose to 16.6%. Over the trailing twelve months, revenue was $150.5M, yielding diluted EPS of $1.73 and a profit margin of 20.0%. In the latest quarter ended June 30, 2026, quarterly revenue increased 5.2% year-over-year, while quarterly earnings grew 14.1%.

As of June 30, 2026, Waterstone Financial held $275.5M in cash and short-term investments against total debt of $412.0M, resulting in net debt of $136.5M. Total assets stood at $2.25B and shareholders' equity reached $351.1M, reflecting a debt-to-equity ratio of 1.17 and a current ratio of 0.15. In FY2025, operating cash flow was $19.0M, supporting capital expenditures of $1.2M and free cash flow of $17.9M. Capital return was prioritized through $16.2M in share buybacks and $10.8M in dividends paid, contributing to a 5-year share count reduction of 27.3%.

At $19.91 per share, Waterstone Financial trades at a trailing price-to-earnings multiple of 11.5x, slightly below the 12.1x median of its US-listed Financial Services peers. However, its forward P/E of 20.7x stands well above the peer median of 10.8x. The company trades at a price-to-sales ratio of 2.4x compared to the peer median of 3.2x, and holds a price-to-book ratio of 1.0x. Waterstone's enterprise value is $730.9M. Over the past year, WSBF shares rose 41.1%, compared to a 16.8% return for the S&P 500, though its 5-year return of 22.0% lagged the S&P 500 gain of 83.0%.

Waterstone Financial pays an annualized forward dividend of $0.68 per share, offering a 3.41% yield with a payout ratio of 38.3%. The quarterly dividend has been paid for 13 consecutive years, though it recorded a 5-year annualized growth rate of -14.1%. The last ex-dividend date was October 8, 2026.

Wall Street coverage for Waterstone Financial features a mean price target of $12.50, implying downside of 37.2% from its last close of $19.91. The company has beaten consensus earnings estimates in 3 of the last 4 quarters. The next earnings announcement date is scheduled for October 22, 2026.

This page is an AI-written research summary of Waterstone Financial, Inc. (WSBF). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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