GET DAILY SIGNALSBridgewater Bancshares (BWB) Delivers Solid Third-Quarter Results Despite Integration Costs
Key Takeaways
- Net income of $11.6 million, or $0.38 per diluted common share, essentially flat versus the second quarter and up from $0.27 a year earlier.
- Adjusted diluted earnings per share (EPS), a non-GAAP measure, was $0.39, up from $0.37 last quarter and $0.28 a year ago.
- Net interest income rose $1.6 million, or 5.1% sequentially, and net interest margin (NIM) expanded one basis point to 2.63%.
- Gross loans grew 6.6% annualized and core deposits climbed 11.5% annualized during the quarter.
- Tangible book value per share reached $14.93, up 20% annualized from the prior quarter.
- The efficiency ratio rose to 54.7%, reflecting elevated conversion and marketing costs tied to a recent acquisition.
Earnings Context and Why It Matters
Bridgewater Bancshares, the parent of St. Louis Park, Minnesota-based Bridgewater Bank, has built a reputation on gaining loan and deposit market share in the Twin Cities, often capitalizing on disruption from bank mergers and acquisitions (M&A). Its third quarter 2025 results arrived shortly after the successful systems conversion of its acquisition of First Minnetonka City Bank, making this report a key test of whether integration costs would obscure an otherwise solid operating trend. Investors were watching deposit costs, loan growth, and net interest margin closely, given the company's liability-sensitive balance sheet and the Federal Reserve's shift toward a rate-cutting environment that generally benefits funding costs. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Reported Results
For the third quarter ended September 30, 2025, Bridgewater Bancshares reported net income of $11.6 million, compared with $11.5 million in the second quarter of 2025 and $8.7 million a year earlier. Diluted earnings per common share were $0.38, unchanged from the prior quarter and up from $0.27 in the third quarter of 2024. On an adjusted basis, net income was $12.0 million, or $0.39 per diluted common share, versus $0.37 in the second quarter and $0.28 a year ago.
Net interest income increased $1.6 million, or 5.1%, from the second quarter, reaching roughly $34.1 million. Net interest margin, calculated on a fully tax-equivalent basis, ticked up one basis point to 2.63%, supported by higher loan yields and an increase in earning-asset yields. The company noted that loan yields rose five basis points during the quarter.
On the balance sheet, gross loans grew $68.8 million, or 6.6% annualized, while total deposits increased 5.2% annualized and core deposits climbed 11.5% annualized. Asset quality remained stable, with net loan charge-offs of just 0.03% of average loans and nonperforming assets at 0.19% of total assets. The efficiency ratio, however, rose to 54.7% from 52.6%, reflecting redundant expenses ahead of the core systems conversion and higher marketing costs. Tangible book value per share of $14.93 rose 20% annualized from the prior quarter. From what I see, the deposit momentum here stands out as a positive sign.
Market Reaction and Investor Sentiment
Heading into the report, sentiment around Bridgewater Bancshares was generally constructive, with the stock outperforming the broader market through much of 2025 on the strength of its balance-sheet growth and the prospect of lower funding costs. Adjusted EPS of $0.39 came in roughly in line with some consensus estimates and modestly below others, making the quarter a mixed read for investors more focused on headline results. Management's commentary on the earnings call emphasized a favorable outlook for continued balance-sheet growth and "more meaningful" net interest margin expansion in the fourth quarter and into 2026, which helped frame the quarter as a transitional period rather than a setback. Persistent themes such as core deposit momentum, steady loan growth, and strong tangible book value growth remained the dominant drivers of investor attention. I’m watching this closely as the rate environment evolves.
Forward Outlook and Key Factors to Monitor
Management sees a path toward a 3% net interest margin by early 2027, with improvement expected to build steadily as the company's liability-sensitive balance sheet benefits from lower short-term rates. Deposit costs are expected to decline in the fourth quarter, given roughly $1.7 billion of funding tied to short-term rates, including about $1.4 billion of immediately adjustable deposits that reprice lower following the Federal Reserve's September rate cut.
On the asset side, the company cited meaningful loan repricing upside, with approximately $608 million of fixed-rate loans scheduled to mature over the next twelve months at a weighted average yield in the mid-to-high 5% range. With new originations pricing in the mid-6% range, that turnover could support further margin expansion.
Investors should also monitor expense trends now that the systems conversion is complete, as management expects expenses to normalize and grow more in line with asset growth. Credit quality bears watching after a multi-family loan migrated to a weaker risk rating during the quarter, though overall charge-offs and nonperforming assets remain low. Finally, the company continues to target becoming a $10 billion bank by 2030, and its ability to sustain deposit and loan growth amid ongoing M&A disruption in the Twin Cities will be a key factor in the quarters ahead.
Using Tickeron’s AI Tools for Deeper Analysis
In my research on regional banks like this one, I often turn to Tickeron’s AI Screener to quickly filter for peers with similar growth profiles or margin trends. It helps surface comparable names and technical signals without spending hours on manual screens, which is especially useful when evaluating how Bridgewater Bancshares stacks up against the broader sector. One thing that stands out is how these tools can highlight potential breakout candidates or valuation gaps in real time.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
BWB's Indicator enters downward trend
The Aroon Indicator for BWB entered a downward trend on October 16, 2026. Tickeron's A.I.dvisor identified a pattern where the AroonDown red line was above 70 while the AroonUp green line was below 30 for three straight days. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options. A.I.dvisor looked at 207 similar instances where the Aroon Indicator formed such a pattern. In 143 of the 207 cases the stock moved lower. This puts the odds of a downward move at 69%.
Technical Analysis (Indicators)
Bearish Trend Analysis
Following a 3-day decline, the stock is projected to fall further. Considering past instances where BWB declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 63%.
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where BWB's RSI Oscillator exited the oversold zone, 11 of 23 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 48%.
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 40 of 66 cases where BWB's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 61%.
The Momentum Indicator moved above the 0 level on October 20, 2026. You may want to consider a long position or call options on BWB as a result. In 49 of 81 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 60%.
The Moving Average Convergence Divergence (MACD) for BWB just turned positive on October 13, 2026. Looking at past instances where BWB's MACD turned positive, the stock continued to rise in 37 of 55 cases over the following month. The odds of a continued upward trend are 67%.
Following a +2.18% 3-day Advance, the price is estimated to grow further. Considering data from situations where BWB advanced for three days, in 210 of 314 cases, the price rose further within the following month. The odds of a continued upward trend are 67%.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 34 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is 48 (best 1 - 100 worst), indicating steady price growth. BWB’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 69 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 73 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.194) is normal, around the industry mean (1.241). P/E Ratio (10.905) is within average values for comparable stocks, (13.089). Projected Growth (PEG Ratio) (1.400) is also within normal values, averaging (1.190). Dividend Yield (0.000) settles around the average of (0.036) among similar stocks. P/S Ratio (3.683) is also within normal values, averaging (3.738).
The Tickeron Profit vs. Risk Rating rating for this company is 75 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. BWB’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 56, placing this stock worse than average.
The Tickeron Seasonality Score of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
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General Information
a regional bank
Industry RegionalBanks
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