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SLM trades cheaply despite strong Q1 results and raised guidance amid rising credit risks.

Company Fundamentals
28 Apr 2026
Seeking Alpha
View Source
Neutral
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SLM Corporation reported strong Q1 2026 earnings with EPS of $1.54, beating expectations, and raised its full-year guidance to $3.10–$3.20. The company benefits from a high return on equity and a dominant position in the private student loan market, supported by a solid net interest margin of 5.29% and aggressive capital returns. However, rising overdue loans and increased provisions indicate growing credit risk, partially offset by one-time reserve releases from loan sales. Investors see value in SLM's current low valuation, but the stock's upside depends on stabilizing credit quality to avoid turning this opportunity into a value trap.

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