Highlights

  • Zions Bancorporation shows 45.77% basic EPS growth, a P/E of 8.12 and PEG of -1.48.
  • Third quarter net earnings were $262 million, or $1.78 per diluted share, against $221 million.
  • Zions repurchased 1.1 million common shares for $75 million; the dividend was $0.48 per share.
  • Management guided third quarter 2027 net interest income growth of approximately 8% to 12%.

An undervalued growth stock pairs earnings growth with its P/E and PEG ratios, and Zions Bancorporation (NASDAQ:ZION) shows all three: basic earnings per share grew 45.77% over one year, the trailing twelve-month P/E ratio is 8.12 and the PEG ratio, on an expected basis, is -1.48, with shares trading at USD 65.30 on October 28, 2026, down 0.58%. Alongside those figures, the Salt Lake City bank completed its acquisition of Basis Multifamily Finance I, LLC at the end of July, repurchased 1.1 million common shares for $75 million in the third quarter, and reported third quarter 2026 net earnings of $262 million on October 19.

Zions Bancorporation, National Association is based in Salt Lake City, Utah, and organized under the laws of the United States of America. It operates principally through seven separately managed, geographically defined bank divisions, each with its own local brand and management, serving customers primarily in 11 Western states. The bank reported total assets of approximately $89 billion at December 31, 2025. It had 8,996 full-time equivalent employees at September 30, 2026.

Growth: Third Quarter Earnings, Net Interest Income and Credit

Net earnings applicable to common shareholders were $262 million in the third quarter of 2026 against $221 million a year earlier, and $946 million for the nine months against $633 million. Basic earnings per share were $1.78 against $1.48, and $6.40 for the nine months against $4.25. Chairman and Chief Executive Officer Harris Simmons said the higher earnings primarily reflected lower net loan charge-offs, at $3 million against $56 million.

Net interest income was $684 million, up 2%, while the net interest margin was 3.23% against 3.28%. Customer-related noninterest income was $192 million, up 18%. Noninterest expense was $553 million, up 5%. The provision for credit losses was a benefit of $8 million, against an expense of $49 million. Loans and leases were $62.5 billion, up 4%, and total deposits were $77.9 billion, up 4%.

Valuation: P/E of 8.12, PEG of -1.48 and Returns on Equity

The P/E ratio of 8.12 is measured on trailing twelve-month earnings,, and the PEG ratio of -1.48 on an expected basis. Return on average common equity was 13.5% against 13.3%, and return on average tangible common equity, a non-GAAP measure, was 16.2%. Book value per common share was $52.56 against $46.05, and tangible book value per common share, a non-GAAP measure, was $43.50, up 13%.

Management said on the third quarter call that its moderately asset-sensitive balance sheet should produce stronger net interest income in a higher rate environment, and that it expects noninterest income growth to continue into next year.

Capital Returns, Funding and Balance Sheet

Zions repurchased 1.1 million common shares for $75 million in the third quarter and none in the prior year quarter. Common dividends paid were $71 million, and the common dividend was $0.48 per share against $0.45. The estimated common equity tier 1 capital ratio was 11.8% against 11.3%.

Customer deposits, excluding brokered deposits, were $74.5 billion, up 5%. Short-term borrowings were $843 million, down 76%, and long-term debt was $2.4 billion, up 64% on senior note issuances over the past year. Chief Financial Officer Ryan Richards said on the call that the company sees scenarios in which its capital absorption could increase, subject to regulatory approvals and Board decisions.

Disclosed Risks and Outlook

The efficiency ratio, a non-GAAP measure, was 61.9% against 59.6%, and adjusted noninterest expense was $549 million, up 6%. Nonperforming assets were $315 million, or 0.50% of loans and leases and other real estate owned, against $324 million, or 0.54%, a year earlier. Classified loans were $2.1 billion, or 3.40% of loans and leases, against 4.00%.

Accumulated other comprehensive income reflected a net loss of $2.0 billion, including $1.4 billion of unrealized losses on securities previously transferred from available-for-sale to held-to-maturity. Mr. Simmons said loan growth was flat against the second quarter, with loan payoffs and a highly competitive market.

On the call, management said its outlook uses the forward rate curve at September 30, which assumes rate increases in December, March and June. For the third quarter of 2027 against the third quarter of 2026, it expects net interest income growth of approximately 8% to 12%, loan growth of 2% to 4%, adjusted customer-related fee income growth of 6% to 9% and adjusted noninterest expense growth of 4% to 6%. It now expects 2026 operating leverage of approximately 40 to 50 basis points, against a prior 100 to 150 basis points before the acquisition.