NASDAQ$SLM

SLM Corp · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

Sallie Mae reported fourth-quarter earnings.

Sallie Mae reported a GAAP net income attributable to common stock of $137 million, or $0.32 per diluted share, for the fourth quarter of 2019. The company plans $3 billion of private education loan sales to fund expected $600 million in share repurchases in 2020.

  • Net interest income increased to $419 million, up 9% from the prior year.
  • Private education loan originations totaled $717 million, a decrease of 2% from the prior year.
  • Average private education loans outstanding were $23.2 billion, up 13.8% from the prior year.
  • Non-GAAP Operating Efficiency Ratio was 33.6%.

Headline financials

Total Revenue

$419M

Previous: $383M+9.5%
EPS (adj)

$0.33

Previous: $0.31+6.5%
Net Interest Margin

5.4%

No prior period
Private Loan Originations

$717M

No prior period
Net Income

$141M

Previous: $143M-1.4%
Operating Income

$176M

No prior period
Cash & Equivalents

$5.56B

Previous: $2.56B+117.4%
Total Assets

$32.7B

Previous: $26.6B+22.7%
Stock-Based Comp

$5.76M

Previous: $5.7M+1.1%

Revenue & EPS history

SLM · Revenue · Quarterly

$419M

Q4 2019+9.5%vs Q4 2018
Beat estimate in 3 of 16 quarters(19%)
ActualEstimate

Forward guidance

For 2020, the company expects full-year diluted “Core Earnings” per share of $1.85 - $1.91 and full-year Private Education Loan originations year-over-year growth of 6%.

Tailwinds

  • Full-year diluted “Core Earnings” per share of $1.85 - $1.91
  • Full-year provisions for credit losses of $285 million - $305 million
  • Full-year total portfolio net charge-offs of $275 million - $285 million
  • Full-year Private Education Loan originations year-over-year growth of 6%
  • Full-year non-interest expenses of $570 million - $580 million

Headwinds

  • Impact of CECL on the provisions for credit losses
  • Company discontinued new Personal Loan originations in the fourth quarter of 2019
  • Company expects to sell approximately $3 billion in loans in 2020, dependent upon market conditions.
  • Company expects to remain well capitalized during the phase-in of regulatory capital following the implementation of CECL
  • Implementation of CECL will have a material impact on how the company records and reports its financial condition and results of operations and on regulatory capital

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

+0.0%

Avg return

Earnings day

+0.7%

Avg return

5 days after

+2.9%

Avg return

30 days after

46%

33 / 72 earnings

Positive

+33.2%

Q4 2019

Best reaction

-16.6%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.8%-1.8%-5.5%
Q4 2025+3.3%-1.2%-15.4%
Q3 2025+3.6%+0.9%+4.3%
Q2 2025-8.1%-7.1%-14.7%
Q1 2025-1.4%+2.7%+19.3%
Q3 2024-3.6%-3.0%+17.8%
Q2 2024-2.1%-4.0%-7.9%
Q1 2024+0.0%-1.4%-4.3%
Q4 2023+3.5%+5.1%+2.5%
Q3 2023+1.2%+1.2%+10.6%
Q2 2023-4.5%-1.8%-13.2%
Q1 2023+6.0%+3.5%+11.1%
Q4 2022-15.8%-12.5%-18.9%
Q3 2022-1.8%+1.2%+4.2%
Q2 2022-5.1%-3.1%-9.2%
Q1 2022+1.4%+1.6%+17.0%
Q4 2021+2.0%+6.8%+16.4%
Q3 2021+4.4%+6.5%+4.7%
Q2 2021-4.2%-6.3%-8.3%
Q1 2021-0.6%+1.5%+4.5%
Q4 2020+6.7%+5.5%+20.9%
Q3 2020-0.8%+0.2%+14.0%
Q2 2020-1.8%-2.0%+1.4%
Q1 2020+6.2%+10.4%+8.1%
Q4 2019+33.2%+27.0%+36.5%
Q3 2019-7.6%-5.4%-3.4%
Q2 2019-4.3%-4.1%-14.4%
Q1 2019-3.1%-3.8%-1.5%
Q4 2018+14.4%+15.8%+21.1%
Q3 2018-2.6%-6.0%-4.4%
Q2 2018-5.0%-2.5%-2.5%
Q1 2018+2.3%+0.6%+0.0%
Q4 2017-2.1%-3.9%-1.7%
Q3 2017+1.7%-2.9%-8.2%
Q2 2017-4.3%-3.4%-9.9%
Q1 2017+10.5%+11.0%-4.9%
Q4 2016+3.6%+3.6%+11.6%
Q3 2016-1.8%-0.8%+30.8%
Q2 2016-1.4%-0.6%+3.4%
Q1 2016+2.2%
Q4 2015+11.9%
Q3 2015-1.4%
Q2 2015-5.6%
Q1 2015+4.1%
Q4 2014-6.0%
Q3 2014+1.9%
Q2 2014+3.3%
Q1 2014+4.3%
Q4 2013-10.1%
Q3 2013+2.1%
Q2 2013+4.4%
Q1 2013-5.1%
Q4 2012-3.1%
Q3 2012-1.1%
Q4 2011+1.8%
Q2 2012-6.1%
Q1 2012+0.2%
Q3 2011+0.6%
Q2 2011-16.6%
Q1 2011-2.2%
Q4 2009-4.1%
Q4 2010-4.1%
Q4 2008-4.1%
Q3 2010-2.6%
Q2 2010+3.6%
Q1 2009-5.5%
Q1 2010-0.2%
Q4 2007-1.3%
Q3 2009+3.7%
Q3 2008+3.7%
Q2 2008+4.8%
Q2 2009+4.8%

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