SLM (NASDAQ:SLM) Issues Quarterly Earnings Results, Beats Expectations By $0.17 EPS

SLM (NASDAQ:SLM) announced its earnings results on Thursday. The credit services provider reported $1.12 earnings per share for the quarter, topping analysts’ consensus estimates of $0.95 by $0.17, FiscalAI reports. SLM had a net margin of 26.04% and a return on equity of 35.11%. The firm had revenue of $656.82 million during the quarter, compared to analyst estimates of $383.43 million. During the same period in the prior year, the business earned $0.50 EPS. SLM updated its FY 2026 guidance to 2.700-2.800 EPS.

Here are the key takeaways from SLM’s conference call:

• PLUS reform could be a major growth driver: management estimates the reform could add about $5 billion of annual originations (~70% growth over 2025) and guides 2026 originations up 12–14%, with expected EPS acceleration beginning in 2027 (high-teens to low-20s growth if TAM materializes).
• Launched an inaugural private credit strategic partnership (no clawbacks, supplemental fee tied to return thresholds) and will warehouse and sell newly originated loans (management cited ~30% of originations), a move they say improves capital efficiency and creates more predictable, recurring earnings.
• Management plans to invest aggressively in 2026—guiding non-interest expenses of $750–$780M (vs $659M in 2025)—and expects 2026 diluted EPS of $2.70–$2.80, implying a short-term earnings headwind versus 2025 EPS of $3.46.
• Credit and reserves are presented as stable: FY2025 net charge-offs were $346M (2.15% of loans in repayment), reserve rate ~6%, 30+ day delinquency ~4%, and 2026 net charge-off guidance is $345–$385M; management notes that changes to loan-sale strategy affect reported (non-GAAP) metrics.

SLM Stock Performance

Shares of SLM opened at $27.62 on Friday. The company has a market cap of $5.61 billion, a PE ratio of 7.96, a price-to-earnings-growth ratio of 1.19 and a beta of 1.12. The firm has a 50-day moving average of $27.71 and a 200-day moving average of $28.94. SLM has a one year low of $23.81 and a one year high of $34.97. The company has a debt-to-equity ratio of 3.27, a current ratio of 1.37 and a quick ratio of 1.37.

SLM Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Monday, March 16th. Stockholders of record on Thursday, March 5th will be given a $0.13 dividend. This represents a $0.52 dividend on an annualized basis and a dividend yield of 1.9%. The ex-dividend date of this dividend is Thursday, March 5th. SLM’s dividend payout ratio (DPR) is 18.25%.

Analyst Ratings Changes

A number of equities analysts have weighed in on SLM shares. Compass Point downgraded SLM from a “buy” rating to a “sell” rating and reduced their price target for the stock from $35.00 to $23.00 in a research report on Tuesday, December 9th. Jefferies Financial Group reduced their target price on shares of SLM from $40.00 to $31.00 and set a “buy” rating for the company in a report on Friday, October 17th. Wells Fargo & Company raised their target price on shares of SLM from $30.00 to $32.00 and gave the company an “overweight” rating in a research report on Friday. Deutsche Bank Aktiengesellschaft reissued a “buy” rating and set a $40.00 price target on shares of SLM in a research report on Friday. Finally, Royal Bank Of Canada increased their price objective on shares of SLM from $31.00 to $32.00 and gave the stock an “outperform” rating in a research note on Friday, October 24th. Seven equities research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and three have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the stock currently has an average rating of “Hold” and an average target price of $31.70.

Key Stories Impacting SLM

Here are the key news stories impacting SLM this week:

• Positive Sentiment: Q4 results beat expectations — EPS of $1.12 vs. $0.95 consensus and revenue well above estimates; profitability metrics (net margin, ROE) improved, supporting the rally. Sallie Mae Reports Fourth Quarter and Full-Year 2025 Financial Results
• Positive Sentiment: Management set 2026 origination growth target of ~12–14% and launched a new $500M share‑repurchase program, signaling confidence in cash generation and potential EPS support. SLM outlines 12%-14% origination growth for 2026 while launching new $500M share repurchase program
• Positive Sentiment: Quarterly dividend declared ($0.13 per share; record March 5), adding modest income support and reflecting cash return policy. Dividend Declaration
• Neutral Sentiment: Management commentary and analyst deep dives highlight strategic partnerships and regulatory items that shape 2026 growth — useful context but not an immediate price driver by itself. SLM Q4 Deep Dive: Strategic Partnerships and Regulatory Changes Shape 2026 Outlook
• Negative Sentiment: FY‑2026 EPS guidance of $2.70–2.80 came in slightly below the published consensus (~$2.84), which could cap near‑term upside despite the quarter’s beat. Earnings Presentation / Guidance
• Negative Sentiment: Multiple law firms have filed or solicited lead‑plaintiff candidates in securities‑fraud class actions (class period July 25–Aug 14, 2025) with a Feb. 17, 2026 lead‑plaintiff deadline — ongoing litigation risk that can increase legal costs and add headline volatility. SLM Shareholders Opportunity to Lead Securities Fraud Lawsuit

Hedge Funds Weigh In On SLM

A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Goldman Sachs Group Inc. raised its stake in SLM by 33.4% in the first quarter. Goldman Sachs Group Inc. now owns 547,724 shares of the credit services provider’s stock valued at $16,087,000 after buying an additional 137,285 shares during the period. Entropy Technologies LP boosted its stake in shares of SLM by 616.6% during the 3rd quarter. Entropy Technologies LP now owns 109,485 shares of the credit services provider’s stock worth $3,031,000 after acquiring an additional 94,207 shares during the period. Captrust Financial Advisors increased its holdings in shares of SLM by 6.1% during the 2nd quarter. Captrust Financial Advisors now owns 36,889 shares of the credit services provider’s stock worth $1,210,000 after acquiring an additional 2,109 shares during the last quarter. Dynamic Technology Lab Private Ltd bought a new stake in SLM in the 1st quarter valued at $263,000. Finally, NewEdge Advisors LLC raised its stake in SLM by 6.6% in the 1st quarter. NewEdge Advisors LLC now owns 21,350 shares of the credit services provider’s stock valued at $627,000 after acquiring an additional 1,319 shares during the period. Institutional investors own 98.94% of the company’s stock.

About SLM

SLM Corporation, operating as Sallie Mae Bank, is a leading U.S.-based consumer banking company specializing in education financing and related banking products. The company provides a range of private student loans for undergraduate and graduate studies, Parent PLUS loans, and specialized financing for career and certificate programs. In addition to its core lending services, Sallie Mae offers deposit products including savings accounts, checking accounts, money market accounts, certificates of deposit, and credit cards tailored to students and young adults.

Founded in 1972 as the Student Loan Marketing Association—a government-sponsored enterprise—Sallie Mae was privatized in 2004 and has since focused on expanding its private education loan offerings and digital banking solutions.