Navient Corporation NAVI reported first-quarter 2026 earnings per share (EPS) of 20 cents, surpassing the Zacks Consensus Estimate of 17 cents. It reported earnings of 28 cents in the prior-year quarter.
Results benefited from lower expenses and a decline in provisions for loan losses. However, a decrease in net interest income (NII) and other income acted as a headwind. Given the concern, NAVI shares lost nearly 4.6% in the early trading session. A full day’s trading session will depict a clearer picture.
Navient’s GAAP net income was $17 million compared with $2 million in the prior-year quarter.
Navient’s NII & Expenses Decline
NII declined 12.5% year over year to $126 million in the first quarter. It missed the Zacks Consensus Estimate by 1.6%.
Total other income decreased 68.6% year over year to $16 million.
Provision for loan losses was $27 million, down from $30 million in the prior-year quarter.
Total expenses decreased 29% year over year to $93 million.
NAVI’s Quarterly Performance of Segments
Federal Education Loans: The segment generated a net income of $22 million, which declined 8.3% year over year.
As of March 31, 2026, the company’s net FFELP loans were $27.2 billion, down 3.2% sequentially.
Consumer Lending: This segment reported a net income of $35 million, which decreased 23.9% from the year-ago quarter.
The private education loan delinquency rate greater than 30 days was 5.5% compared with 6.4% in the prior-year quarter.
As of March 31, 2026, the company’s private education loans were $15.6 billion, which decreased 1.3% from the prior quarter. Navient originated $778 million of private education refinance loans in the reported quarter.
Navient’s Liquidity
To meet liquidity needs, NAVI expects to utilize various sources, including cash and investment portfolio, predictable operating cash flows provided by operating activities, the repayment of principal on unencumbered education loan assets and distributions from securitization trusts. It may also draw down on the secured FFELP Loan and Private Education Loan facilities, issue term asset-backed securities (ABS), enter additional Private Education Loan and ABS repurchase facilities, or issue additional unsecured debt.
Notably, the company had $621 million of total unrestricted cash and liquid investments as of March 31, 2026.
Navient’s Capital Distribution Activities
In the first quarter, the company paid $15 million in common stock dividends.
In the reported quarter, Navient repurchased shares of common stock for $23 million.
Our Take on NAVI
Navient has been an eminent portfolio holder of private education loans. Its diversified business segments are likely to support revenue growth. The strategic actions undertaken to control expenses are expected to support financials in the upcoming period. The company’s first-quarter results benefited from lower expenses and a modest decline in provisions. However, weaker NII remains a near-term concern.
Navient Corporation Price, Consensus and EPS Surprise
Navient Corporation price-consensus-eps-surprise-chart | Navient Corporation Quote
NAVI’s Zacks Rank
Currently, NAVI carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Navient’s Peers
Ally Financial ALLY reported first-quarter 2026 adjusted earnings of $1.11 per share, which surpassed the Zacks Consensus Estimate of 93 cents. The bottom line reflected a 90% jump from the year-ago quarter.
Results of ALLY primarily benefited from a rise in net financing revenues and a sharp increase in other revenues. Also, lower expenses were a tailwind. An increase in loan and deposit balances further supported the results. However, a rise in provisions was a headwind.
Enova International, Inc. ENVA reported first-quarter 2026 adjusted earnings per share of $3.87, which increased from $2.98 in the prior-year quarter. The metric surpassed the Zacks Consensus Estimate of $3.66.
ENVA’s results were aided by increased revenues and improving credit quality. However, an increase in expenses was a headwind.
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This article originally published on Zacks Investment Research (zacks.com).