Capitol Federal Financial (CFFN) opened Q1 2026 with total revenue of US$55.7 million and basic EPS of US$0.16, supported by trailing 12 month net income of US$72.8 million. The company has seen total revenue move from US$46.2 million in Q1 2025 to US$55.7 million in Q1 2026, while basic EPS over the same period shifted from US$0.12 in the quarter a year ago to US$0.16, setting up a results season in which higher net profit margins are a key part of the story for investors.

See our full analysis for Capitol Federal Financial.

With the headline numbers on the table, the next step is to weigh these results against the widely followed narratives around Capitol Federal Financial to see which views are backed up by the data and which might need a reset.

34.7% net margin stands out

• On a trailing basis, Capitol Federal Financial turned US$209.7 million of revenue into US$72.8 million of net income, which works out to a 34.7% net margin compared with 28% a year ago.
• What jumps out for a bullish view is that trailing 12 month earnings rose 43.2% while margins also sat at 34.7%. However, this sits against a five year earnings decline of 17.4% per year, so anyone leaning optimistic has to weigh the recent margin strength against that longer term earnings slide.

Loan book and credit quality watchpoints

• Total loans were around US$8.1b at the end of Q4 2025 with non performing loans reported at roughly US$48.1 million, and the allowance for bad loans is described as relatively low at 50%.
• Critics highlight that a low allowance for bad loans can be a risk for a bank, and the move in non performing loans from roughly US$11.4 million in Q1 2025 to around US$48.1 million by Q4 2025 gives that bearish concern a concrete data point, even as the business produced US$72.8 million of net income over the last 12 months.

Here, skeptics point to the rising non performing loans and 50% allowance figure as reasons to question how durable the recent profitability is before taking on more exposure. 🐻 Capitol Federal Financial Bear Case

P/E of 12.5x versus DCF fair value

• The shares trade on a P/E of 12.5x at a price of US$7.10, which is below the US market average of 19.3x and peers at 18.3x, and slightly above the US Banks industry at 11.8x, while a DCF fair value of roughly US$2.40 sits well below the current share price.
• What is interesting for a balanced view is that the lower than market and peer P/E multiple can look like value support. Yet, the DCF fair value of about US$2.40 compared with the US$7.10 share price, together with an unstable dividend record, gives investors mixed signals even after a year where revenue reached US$209.7 million and net income was US$72.8 million.

If you want to see how these margin, credit, and valuation threads fit into a bigger picture for Capitol Federal Financial, the full narrative lays out how different investors are reading the same set of numbers. 📊 Read the full Capitol Federal Financial Consensus Narrative.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Capitol Federal Financial's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Capitol Federal Financial pairs a 34.7% net margin with rising non performing loans and a relatively low 50% allowance, which raises clear balance sheet questions.

If that mix of credit risk and limited loss reserves feels uncomfortable, shift your focus toward companies in the solid balance sheet and fundamentals stocks screener (386 results) that put stronger cushions and cleaner balance sheets front and center.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.