NYSE$HTH

Hilltop Holdings Inc · Q2 2021 earnings

Q2 2021 earnings · · Investor relations

Briefing

Hilltop Holdings' financial performance decreased due to lower noninterest income, partially offset by an increase in net interest income and a reversal of credit losses.

Hilltop Holdings reported a net income of $99.1 million for Q2 2021, a decrease of 23% compared to Q2 2020. The decline was primarily driven by lower noninterest income, partially offset by an increase in net interest income and a reversal of credit losses. EPS diluted was $1.21 compared to $1.42 in the prior year quarter.

  • PlainsCapital generated $87.0 million in pre-tax income during Q2 2021, an increase of $104.4 million from Q2 2020.
  • PrimeLending generated $49.0 million in pre-tax income during Q2 2021, a decrease of $89.3 million from Q2 2020.
  • Mortgage origination volume in Q2 2021 was $5.9 billion, a decline of 3% from Q2 2020 and gain-on-sale margin declined by 4 basis points versus Q2 2020 to 364 basis points.
  • HilltopSecurities generated $6.9 million in pre-tax income and a 7.3% pre-tax margin in Q2 2021.

Headline financials

Total Revenue

$448M

Previous: $573M-21.8%
EPS (adj)

$1.21

Previous: $1.08+12.0%
Free Cash Flow

$99.1M

Previous: $128M-22.9%
Net Income

$99.1M

Previous: $128M-22.9%
Operating Income

$396M

Previous: $515M-23.0%
Gross Profit

$447M

Previous: $573M-22.0%
Cash & Equivalents

$1.37B

Previous: $1.66B-17.1%
Total Assets

$17.7B

Previous: $16.9B+4.3%

Revenue & EPS history

Hilltop · Revenue · Quarterly

$448M

Q2 2021-21.8%vs Q2 2020
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Revenue by segment

Hilltop · $176M total across 3 segments · Q4 2022

  • Broker-Dealer
    $92.8M
  • Mortgage Origination
    $71.4M
  • Banking
    $11.9M

Forward guidance

Hilltop Holdings provided commentary on loan growth, deposit growth, net interest income, noninterest income, noninterest expense, provision expense, and effective tax rate for 2021.

Tailwinds

  • FY average total deposit growth: 7 – 10% excluding additional stimulus efforts
  • Deposit costs expected to improve slowly as Consumer CDs mature and reset
  • Non-variable expenses to remain stable with 2020 levels
  • 1 – 4 family loan retention $50 – $75 million per month
  • Effective Tax Rate (GAAP) 22 – 24% full year basis

Headwinds

  • Loan yields expected to remain under pressure, excluding accelerated PPP loan fees
  • Mortgage gain on sale margins continue to be pressured as volumes decline across the industry, FY average 360 – 385 bps (third party sales)
  • Expecting FY PrimeLending mortgage originations between $20 – $23 billion, subject to market conditions
  • Purchase accounting accretion expected to decline by 25 - 35% versus 2020 levels
  • ($5 million) – ($25 million) expected full year provision expense

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 Q2 2021

Historical avgQ2 2021

-0.3%

Avg return

Earnings day

-0.2%

Avg return

5 days after

+1.6%

Avg return

30 days after

45%

30 / 66 earnings

Positive

+17.4%

Q3 2013

Best reaction

-11.3%

Q1 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-3.3%-0.8%-2.0%
Q4 2025+2.2%+6.6%+1.7%
Q3 2025+4.6%+0.1%+4.6%
Q2 2025-2.4%+0.8%+5.7%
Q1 2025-1.1%+0.8%+1.1%
Q4 2024-0.5%+8.3%+7.3%
Q3 2024+2.5%+1.5%+5.6%
Q2 2024-6.3%-5.2%-5.1%
Q1 2024+4.4%+5.1%+10.5%
Q4 2023-1.5%-3.7%-9.4%
Q3 2023-1.3%-2.0%+10.3%
Q2 2023-10.9%-7.9%-8.6%
Q1 2023+6.2%+2.7%+4.9%
Q4 2022+7.1%+8.0%+10.4%
Q3 2022+11.6%+14.0%+15.3%
Q2 2022+0.6%+0.5%+1.5%
Q1 2022-11.3%-12.9%+1.5%
Q4 2021-2.7%-6.1%-11.5%
Q3 2021+5.4%+8.5%+0.0%
Q2 2021-1.3%-1.5%+3.6%
Q1 2021+4.5%+3.0%+10.7%
Q4 2020-4.4%-2.4%+5.2%
Q3 2020-2.3%-2.8%+8.7%
Q2 2020+0.6%-0.3%+6.7%
Q1 2020-6.7%-15.6%-3.2%
Q4 2019-6.1%-4.6%-13.6%
Q3 2019+3.1%+5.9%+3.8%
Q2 2019+0.0%+2.4%+1.6%
Q1 2019+3.5%+4.8%+0.6%
Q4 2018-3.6%-3.9%+2.7%
Q3 2018+9.5%+15.6%+11.6%
Q2 2018-4.0%-5.4%-3.9%
Q1 2018-5.6%-8.5%-3.5%
Q4 2017+2.5%-2.2%-6.8%
Q3 2017+0.1%-7.1%-9.3%
Q2 2017+1.5%+1.8%-3.0%
Q1 2017+2.1%-1.2%-8.5%
Q4 2016-0.4%-3.5%-1.1%
Q3 2016-0.3%-0.1%+15.4%
Q2 2016-1.0%-1.7%+0.9%
Q1 2016-1.7%
Q4 2015+2.1%
Q3 2015-1.7%
Q2 2015-6.7%
Q1 2015+1.8%
Q4 2014-2.6%
Q3 2014-5.5%
Q2 2014-0.1%
Q1 2014-3.7%
Q4 2013+1.3%
Q3 2013+17.4%
Q2 2013-4.2%
Q1 2013+6.5%
Q4 2012+1.4%
Q3 2012-1.1%
Q2 2012-0.9%
Q1 2011-1.1%
Q1 2012+0.8%
Q4 2009+4.9%
Q4 2011+4.9%
Q3 2011+2.1%
Q3 2010+2.1%
Q2 2010-9.7%
Q4 2010-9.7%
Q2 2011-9.7%
Q1 2010+0.3%

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