QCR Holdings delivered a positive third quarter, with management crediting growth in capital markets revenue, robust loan production, and expansion in net interest margin as key drivers. CEO Todd Gipple emphasized that the rebound in capital markets was “driven by strong new loan production from both our LIHTC and traditional lending businesses.” Management also highlighted an 8% increase in wealth management revenue from the prior quarter, noting continued momentum across all three core business lines. Asset quality improved, with total criticized loans decreasing 9% year-to-date, and the company initiated a new share repurchase program, signaling confidence in its long-term strategy.
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QCR Holdings (QCRH) Q3 CY2025 Highlights:
- Revenue: $101.5 million vs analyst estimates of $90.78 million (4.3% year-on-year growth, 11.8% beat)
- Adjusted EPS: $2.17 vs analyst estimates of $1.75 (24.1% beat)
- Adjusted Operating Income: $51.37 million vs analyst estimates of $47.27 million (50.6% margin, 8.7% beat)
- Market Capitalization: $1.27 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From QCR Holdings’s Q3 Earnings Call
- Damon Del Monte (KBW) asked whether margin guidance included benefits from recent or future rate cuts. CFO Nick Anderson clarified that the guidance did not assume additional cuts and detailed the expected margin accretion per rate reduction.
- Nathan Race (Piper Sandler) inquired about the timing and impact of LIHTC loan securitizations. CEO Todd Gipple explained the company is building for a larger securitization in the coming year and expects capital markets revenue to offset any decline in net interest income.
- Daniel Tamayo (Raymond James) questioned the timeline for expense savings from digital transformation. Gipple and Anderson outlined that the cost efficiencies will be most apparent after all core conversions are completed, with near-term expenses remaining elevated due to overlapping systems.
- Jeff Rulis (D.A. Davidson) sought clarification on whether loan growth guidance was net or gross of securitizations. Gipple confirmed the double-digit growth target refers to gross production, with more details to come next quarter.
- Brian Martin (Janney Montgomery) asked about deposit growth strategies and capital allocation for buybacks. Anderson described ongoing relationship-driven deposit initiatives and Gipple emphasized that share repurchases will be opportunistic, balancing capital needs.
Catalysts in Upcoming Quarters
Over the coming quarters, the StockStory team will be closely monitoring (1) the pace of loan growth and the ability to maintain double-digit production, (2) progress on the digital transformation and further core system conversions, and (3) execution of LIHTC loan sales and securitizations to support both capital flexibility and earnings. The impact of additional share repurchases and any new regulatory developments related to the $10 billion asset threshold will also be areas to watch.
QCR Holdings currently trades at $75.52, up from $71.39 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free for active Edge members).
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