First Citizens BancShares (NASDAQ: FCNCA) reported third-quarter 2026 earnings per share (EPS) of $55.37 on Oct. 23, 2026, against an analyst estimate of $46.18. Revenue was $2.43B against an estimate of $2.23B. Profit rose from a year earlier, and the shares traded at $2,375.84 on the latest quote as of that day, up 8.15%. The bank also raised parts of its outlook, but the quarter showed rising funding costs and a thinner interest margin.
Key facts
- EPS, third quarter ended Sept. 30, 2026: $55.37 vs. an estimate of $46.18, a difference of +$9.19 (19.9%), reported Oct. 23, 2026. According to the company's release, this is an adjusted figure.
- Revenue, same quarter: $2.43B vs. an estimate of $2.23B, a difference of +$202.5M (9.1%).
- Net income, same quarter: $606.0M vs. $568.0M in the third quarter of 2025, up 6.7%. Diluted EPS (the unadjusted measure) was $51.23 vs. $43.12 a year earlier.
- Reported revenue: $3.70B vs. $3.69B a year earlier, up 0.1%. This is the income-statement figure and is on a different basis from the $2.43B used for the estimate comparison.
- Stock, latest quote as of Oct. 23, 2026: $2,375.84, up 8.15%. The 52-week range is $1,735.03 to $2,429.96.
- Next report: expected Jan. 22, 2027, with an EPS estimate of $49.4 and a revenue estimate of $2.28B.
What happened
First Citizens beat on both lines. Two numbers can look contradictory, so here is how they fit. The $55.37 EPS that analysts compare against is an adjusted figure. The company's release describes it as an adjusted (non-GAAP) measure, reconciled in its financial supplement. The unadjusted diluted EPS was $51.23, which is still higher than $43.12 a year earlier. Reported revenue of $3.70B was nearly flat against the year-ago quarter, while net income grew 6.7%.
Management named several drivers on the Oct. 23 call.
- Loans grew. Lending rose strongly from the prior quarter, led by fund banking. That means credit lines to private equity and venture funds. Management said use of those lines was at its highest in several years.
- Deposits grew. The company completed its purchase of branches from BMO during the quarter, which brought in a meaningful block of deposits. Deposits also grew through its online Direct Bank and through brokered deposits.
- Net interest income rose. This is what the bank earns on loans and securities minus what it pays on deposits and borrowings. It rose from the prior quarter on larger balances, higher yields, less borrowing and one more day in the quarter.
- Credit stayed steady. Net charge-offs (loans written off as uncollectible) edged down, and loans no longer paying interest also fell, according to the company.
- Capital return continued. The release said the bank bought back stock, kept paying its dividend and approved a new repurchase plan running through 2027. It also repaid more of the FDIC Purchase Money Note.
Why it matters for investors
The five-quarter trend. Revenue and margins moved as follows, from the third quarter of 2025 to the third quarter of 2026:
| Quarter ended | Revenue | Operating margin | Net income | |---|---|---|---| | Sept. 30, 2025 | $3.69B | 20.3% | $568.0M | | Dec. 31, 2025 | $3.65B | 22.2% | $580.0M | | March 31, 2026 | $3.48B | 20.3% | $534.0M | | June 30, 2026 | $3.60B | 24.7% | $672.0M | | Sept. 30, 2026 | $3.70B | 21.8% | $606.0M |
Revenue bottomed in the first quarter of 2026 and has risen since. The June quarter was the high point for margin and profit, and the September quarter stepped back from it while staying above the year-ago level. Gross margin, an FMP-derived figure rather than a standard bank metric, was 64.3%, down from 67.1% in the June quarter. The company's release ties higher funding costs to a rise in interest expense on interest-bearing deposits, reflecting growth in the Direct Bank and brokered deposits, partly offset by a decline in interest expense on borrowings.
Cash flow. FMP's cash-flow data for the September quarter shows zeros, which means the figures are not yet available. The June quarter had operating cash flow of $1.04B and free cash flow of $855.0M. Banks' cash flow is lumpy because it moves with loan and deposit flows, so it is a weaker guide here than net income and capital ratios. Buybacks were $606.0M in the June quarter and $899.0M in the March quarter.
Balance sheet. At Sept. 30, 2026, shareholders' equity was $21.58B and total debt was $116.0M by FMP's measure. FMP's debt figure does not capture all of a bank's deposit and note funding, so it should not be read as the bank having almost no leverage.
Valuation versus peers. FCNCA trades at a trailing price-to-earnings (P/E) ratio of 12.17, with a net margin of 16.6% and a dividend yield of 0.4%. Peers:
| Company | Market cap | P/E | Net margin | |---|---|---|---| | First Citizens (FCNCA) | $26.40B | 12.17 | 16.6% | | BOK Financial (BOKF) | $7.82B | 11.62 | 19.7% | | Commerce Bancshares (CBSH) | $8.04B | 13.41 | 27.0% | | Citizens Financial (CFG) | $27.44B | 13.03 | 19.5% | | Huntington (HBAN) | $31.78B | 12.19 | 16.3% |
FCNCA's P/E is the second-lowest of the five, near the low-middle of the group and close to Huntington's 12.19. Its net margin is at the low end, ahead of only Huntington's.
Analysts. Of 11 ratings, 2 are buy and 9 are hold, giving a consensus of "Hold." Analysts' average price target is $2,387.80, with a median of $2,350.00, a high of $2,550.00 and a low of $2,323.00. The stock traded at $2,375.84 on the latest quote, so it already sits near the average target after Friday's move.
Our MoonshotScore. Stock Expert AI's MoonshotScore V2 for FCNCA is 94.4, rated Exceptional. Within the sector-relative pillars, momentum scores 98, growth 86 and quality 84. Safety scores 70 and valuation 69. Those two are the weaker areas, which matches the thinner margin and the stock's recent run.
What could go wrong
- Funding costs. Management said replacing the FDIC note with other funding is a drag on margin, describing it as "temporary". CFO Craig Nix said: "While it in and of itself is a drag, overall we expect that earning asset yields will outstrip any negative impact of that, and our margins will expand." Arch McClure also said he expects "some positive operating leverage across the aggregate." That view depends on the assumed rate path of one more hike in the fourth quarter of 2026 and two in 2027. Separately, because of the timing of the rate hikes, management said most of the benefit to net interest income arrives in 2027, not now.
- Fund-banking growth. Management expects use of those credit lines to return to more normal levels and growth to slow from this quarter's pace. Competition has kept pressure on the interest earned on these loans, which management said has largely stabilized.
- Venture-linked income. A company executive on the call tied a likely slowdown in venture investing to "the extraordinary pace of venture investment that we've seen year to date", saying a slowdown is "quite likely". The same executive said they had not "detected any dampening of enthusiasm... based on rates" and that whether rates become a headwind in 2027 "remains to be seen". Exits through IPOs remain weak, and income from equity warrants (rights to buy shares in client companies) swings with valuations. A decline in warrant values already weighed on fee income this quarter.
- Rates and rules. Management noted that the forward rate curve could be wrong, which would affect margin. It also said it expects an update or final decision on the Basel III capital rule by year-end. That rule is not only a risk: management estimated the standardized approach would add about 70 basis points to its CET1 capital ratio.
- Financial-strength scores. FMP's Piotroski score is 7 out of 9, which is solid. Its Altman Z-score is 0.32. That model was built for industrial companies and is not well suited to banks, so we treat it as a caution flag only.
- Insiders. Among recent Form 4 filings in the last 90 days, there were 2 open-market purchases and 2 sales, which is mixed.
- Reserves. A Seeking Alpha article that day argued the bank's loan-loss reserves remain a concern. The bank said the reserve release reflects improving credit and growth in lower-loss lending.
What to watch next
- Fourth-quarter results on Jan. 22, 2027. Analysts expect EPS of $49.4 on revenue of $2.28B.
- Guidance. Management raised its outlook for loans, deposits and full-year net interest income, and said the interest margin should improve into 2027 if rates move as assumed. Watch whether the Q4 margin lands where management said.
- Fund banking. Does loan growth slow as management expects, and do loan yields hold?
- Credit. Management guided fourth-quarter net charge-offs to a range of 30 to 35 basis points, above the third quarter's 0.27%, though it still called this "stable". A move outside that band would stand out.
- Capital return. Management expects fourth-quarter buybacks of about $300M, roughly half the $600M in the third quarter, now that CET1 is in its target range. It expects a similar quarterly baseline in 2027, with the amount flexible each quarter, under a new repurchase plan running through 2027.
- Later quarters. Analysts' estimates for the periods ending March 30 and June 30, 2028 are EPS of $50.95 and $53.79, with revenue of $2.59B and $2.61B.
Frequently asked questions
Q: Did First Citizens beat earnings estimates in the third quarter of 2026?
Yes. For the quarter ended Sept. 30, 2026, First Citizens reported EPS of $55.37 against an analyst estimate of $46.18. Revenue was $2.43B against an estimate of $2.23B. Both were reported on Oct. 23, 2026. The EPS figure is an adjusted measure, and diluted EPS was $51.23 vs. $43.12 a year earlier.
Q: Why did FCNCA stock move after earnings?
The shares traded at $2,375.84 on the latest quote as of Oct. 23, 2026, up 8.15%. The bank beat estimates, grew loans and deposits, kept credit quality steady and raised parts of its outlook, according to its release and call. We cannot say which factor mattered most to buyers. The stock remains below the high end of its 52-week range of $1,735.03 to $2,429.96.
Q: What are the main risks for First Citizens after this report?
Management named higher funding costs as it replaces the FDIC note, a likely slowdown in fund-banking growth, weak IPO activity and venture-related income that can swing with valuations. It also pointed to rate-path uncertainty and the pending Basel III capital rule. Analysts' consensus rating is Hold, and the stock trades near the average analyst price target of $2,387.80. This article is not investment advice.
This is educational content, not investment advice. Past performance does not guarantee future results.