WaFd’s EverBank Merger Could Boost 2027 EPS by 29%. Here’s What WAFD Investors Need to Know

Mikirduit — WaFd Inc. (NASDAQ: WAFD) is combining with EverBank Financial Corp. in a $3.9 billion reverse-merger transaction that could dramatically reshape the regional lender—and potentially lift earnings per share by nearly 30% in 2027.

3 Key Takeaways

• Existing WaFd shareholders will own only 40.8% of the combined company, but management expects the merger to increase 2027 EPS by roughly 29%.
• The combined EverBank is expected to have about $75 billion in assets and generate $135 million in annualized cost synergies once integration is fully completed.
• WAFD’s pro-forma valuation near 0.99 times book value looks inexpensive, but execution risk and heavy dilution could keep the shares volatile before the deal closes.

The deal comes with a catch.

Existing WaFd shareholders will own just 40.8% of the combined company, meaning substantial dilution. EverBank shareholders will control the remaining 59.2%.

Still, management expects the larger balance sheet, broader lending platform and $135 million of planned annual cost savings to more than offset that dilution over time.

For WAFD investors, the question is relatively straightforward: Is giving up majority ownership worth the potential jump in earnings power?

How the WaFd-EverBank Merger Works

The transaction is somewhat unusual.

Legally, EverBank Financial Corp. will merge into WaFd Inc., leaving WaFd as the surviving publicly traded holding company.

But EverBank will be treated as the accounting acquirer.

After closing, WaFd Inc. will change its name to EverBank Financial Corp., and its Nasdaq ticker will switch from WAFD to EVBK. At the bank level, WaFd Bank will merge into EverBank, N.A., with EverBank surviving as the operating bank.

The transaction is expected to close in the first quarter of 2027, subject to WaFd shareholder approval, regulatory approvals and other customary conditions.

In economic terms, the transaction looks a lot like EverBank gaining control of WaFd while using WaFd's existing public listing.

WaFd Will Issue More Than 100 Million New Shares

The most immediate impact for WAFD investors is dilution.

WaFd expects to issue approximately 103.1 million common shares to EverBank shareholders, or about 107.7 million shares including options and other dilutive securities.

The combined company is expected to have approximately:

• 177.1 million basic shares, and
• 182 million diluted shares

outstanding on a pro-forma basis.

After the transaction:

EverBank shareholders: 59.2%

Existing WaFd shareholders: 40.8%

That is substantial dilution for current WAFD investors.

But dilution alone doesn't determine whether a transaction creates or destroys shareholder value.

What matters is how much earnings, book value and future cash flow investors receive in return for their smaller percentage ownership.

And that is where the deal starts to look more interesting.

EPS Could Rise 29% in 2027

Management estimates the transaction will be approximately 29% accretive to WaFd's 2027 earnings per share.

That means the additional earnings generated by the combined company could more than compensate for the large increase in shares outstanding.

Using the transaction assumptions, WaFd's standalone 2027 EPS is estimated at roughly:

$3.37 a share

After combining with EverBank, pro-forma EPS could reach approximately:

$4.34 a share

That represents roughly 29% EPS accretion.

Management also expects tangible-book-value dilution from the deal to be earned back in less than two years.

That is one of the most important numbers in the transaction.

Existing WaFd investors will own a smaller percentage of the company, but potentially a much more profitable business on a per-share basis.

WaFd Is About to Become a Much Bigger Bank

The merger will also transform WaFd's scale.

WaFd currently operates primarily as a regional banking franchise focused on the Western U.S., with roughly $28 billion in assets.

EverBank brings a different model.

It has roughly $46.7 billion in assets, along with a larger digital-banking franchise and nationwide commercial-lending operations.

Put the two together and the combined institution is expected to have approximately:

$75 billion in assets

and roughly:

$58 billion in loans.

That would make the resulting bank roughly 2.7 times the asset size of WaFd on a standalone basis.

The strategic logic goes beyond simply getting bigger.

WaFd contributes a regional deposit and lending franchise in Western markets, while EverBank brings national commercial lending and a digitally oriented deposit platform.

Management also sees opportunities to expand WaFd's wealth-management operations by marketing investment services to EverBank's more affluent customer base.

The result would be a bank with a more geographically diversified and potentially more scalable business model.

The Biggest Prize: $135 Million in Cost Savings

The clearest financial benefit of the merger could come from expenses.

Management expects approximately $135 million in annualized cost synergies.

That is equivalent to about 11% of the combined company's noninterest expense base.

The savings are expected to come primarily from three areas:

Compensation

Overlapping positions and corporate functions can be consolidated after the merger.

Technology and occupancy

The combined company can eliminate overlapping technology infrastructure, systems and real-estate expenses.

General and administrative expenses

Duplicated corporate functions and other overhead can also be reduced.

If management delivers those savings, the transaction could materially improve the combined bank's efficiency ratio and profitability.

After the full realization of synergies, management is targeting a return on tangible common equity of roughly 15%.

But Investors Won’t Get All the Savings in 2027

There is an important timing issue.

The $135 million in savings won't show up immediately.

Management expects only about 40% of the targeted synergies to be realized during 2027.

The full annualized benefit isn't expected until around mid-2028, with integration substantially completed during the second half of that year.

That means investors shouldn't simply add $135 million to the combined company's 2027 earnings.

The benefits will arrive gradually as systems are integrated, overlapping costs are eliminated and the businesses are consolidated.

That also creates execution risk.

The faster management completes the integration without disrupting customers or deposit flows, the more credible the projected EPS accretion becomes.

Valuation: What Could WAFD Be Worth After the Merger?

Because EverBank will become the accounting acquirer and will represent the majority of the combined company, we compared the pro-forma business with several publicly traded banks that have significant digital or nationally oriented banking operations.

Our peer group includes:

• SoFi Technologies (NASDAQ: SOFI)
• Ally Financial (NYSE: ALLY)
• Axos Financial (NYSE: AX)

For this comparison, we focus primarily on price-to-book value, or P/B, from two perspectives: WaFd's own historical valuation and the valuation of comparable banks.

Pro-Forma WAFD Trades Near 0.99 Times Book Value

Based on our estimates of the combined equity base, increased share count and WAFD's Sept. 8, 2026 share price, the pro-forma company trades at approximately:

0.99 times book value.

This calculation incorporates the enlarged equity base created by the transaction as well as the roughly 182 million diluted shares expected after the merger.

One caveat is important.

The calculation uses total book equity, which includes intangible assets such as goodwill that could arise from purchase accounting.

For banks, tangible book value can therefore provide an additional—and sometimes more conservative—measure of valuation.

Even so, a P/B multiple around 0.99 times puts the combined company near the lower end of WaFd's historical valuation.

WaFd's five-year average has been approximately:

1.0 times book value.

In other words, even after incorporating the transaction, WAFD isn't trading at an obvious premium to its own historical book-value multiple.

WAFD Also Looks Cheap Relative to Peers

The comparison becomes more interesting against peers.

Our estimates show:

On this metric, the future EverBank would trade alongside Ally as the cheapest company in the group.

That discount could be attractive if management successfully delivers the expected earnings accretion and pushes returns toward its approximately 15% ROTE target.

But investors should be careful about treating the peer multiples as directly interchangeable.

SoFi, Ally, Axos and the future EverBank have different funding structures, growth profiles, credit exposures and business mixes.

The relative valuation is useful as a reference point—not necessarily as proof that WAFD is undervalued.

Why WAFD Shares Could Remain Volatile Before Closing

Despite the attractive long-term earnings math, there are reasons WAFD shares could remain under pressure before the transaction closes.

Existing shareholders face major dilution.

More than 100 million new shares will be issued, and former WaFd investors will ultimately control only 40.8% of the new company.

There are also the usual merger risks:

regulatory approval, integration execution, customer retention, deposit stability and the possibility that projected cost savings take longer to materialize than expected.

The deal also includes a phased lockup for EverBank investors following closing, with shares becoming eligible for release at various points over the following 12 months.

That could become another factor investors monitor when evaluating potential future selling pressure.

From a technical perspective, we are watching the $32.47 area, where an earlier price gap could become relevant if WAFD experiences another pullback before closing.

The Bottom Line

The WaFd-EverBank transaction presents investors with an unusual trade-off.

Existing WaFd shareholders are being heavily diluted.

But in exchange, they will own 40.8% of a bank with roughly $75 billion in assets, a nationwide commercial-lending franchise, a larger digital-banking operation and potentially much stronger earnings power.

Management expects approximately 29% EPS accretion in 2027, $135 million of annualized cost savings and a roughly 15% return on tangible common equity once synergies are fully realized.

Those numbers make the dilution easier to justify.

But they also set a high bar for execution.

In the short term, WAFD could remain volatile as investors digest the dilution, regulatory process and integration risks.

The more important test will come after the merger.

Investors shouldn't simply compare the future EVBK with the old WaFd.

They should ask whether the combined EverBank can actually produce the higher earnings, better returns and improved efficiency that management is promising.

If it can, today's valuation near book value could prove inexpensive.

If the integration falters or the $135 million of cost savings fails to materialize, the dilution will become much harder for existing WaFd shareholders to overlook.

The numbers are only the beginning.

Every week, Mikirduit US breaks down earnings, valuations, catalysts, and risks across U.S. stocks—so you can see what the market may be missing.

Get the Weekly Briefing