MyState (ASX:MYS) Shares Reflect Margin Strength And Merger Synergy Progress

MyState stock closed at A$4.96, with the market already baking in a solid year. The headline is simple: earnings growth has been strong while the valuation still looks measured on a 15x P/E, below the broader Australian market and domestic bank peers.

What really mattered in this result was margin resilience. Net profit margins sat at 22.3% over the year, and net interest margin held at 1.5% despite competitive pressure for deposits and home loans. Adding fast growing equipment finance earnings into the mix creates a story that appears more long term than today’s share price move alone suggests.

Like the look of MyState's 22.3% profit margins and 15x P/E but want more options with similar resilience and balance sheet strength? Compare MyState against other banks and lenders in our list of solid balance sheet and fundamentals stocks (20 results)

FY 2026 Earnings Summary

• Revenue FY 2026 (TTM): A$251.9m vs. FY 2025 (TTM) A$186.2m (higher year over year)
• Net Income FY 2026 (TTM): A$56.2m vs. FY 2025 (TTM) A$35.6m (higher year over year)
• Basic EPS FY 2026 (TTM): A$0.331 vs. FY 2025 (TTM) A$0.264 (higher year over year)
• Net Interest Margin (NIM) FY 2026 (TTM): 1.5% vs. FY 2025 (TTM) 1.47% (slightly higher year over year)

Tired of scrolling through dense earnings tables and raw figures trying to piece together MyState's story? See the full picture of its valuation in clean, interactive charts with our company report for MyState.

MyState bull case leans on real synergy delivery

The optimistic view on MyState is that the Auswide merger, Selfco growth and tech investment are already turning into operating leverage and more resilient earnings. The latest year gives that view some concrete support. Underlying NPAT of A$58.3m and ROE of 9.7% show a larger, more profitable bank, with NIM at 1.5% and stronger in the second half. Run rate synergies of A$11.8m, with A$10.7m delivered in the year, put the group about halfway to the A$20m to A$25m FY28 target. Selfco now contributes about 7% of underlying NPAT, which backs the earnings diversification claim. Cost to income improved and 158 integration initiatives are complete, including a single banking licence and early benefits from the digital savings product. This supports the argument that merger and digital milestones are being hit, not just promised.

Bear case focuses on integration strain and margin squeeze

The cautious view is that merger complexity, rising costs and margin pressure could cap MyState’s upside. The result gives that argument some traction as well as some pushback. Integration costs are now expected to total A$32m through June 2028, higher than earlier guidance, which directly supports fears that the merger and new AI enabled core platform are more expensive than first planned. Management also flagged ongoing pressure in retail margins and intense competition for lending and deposits, which fits concerns about NIM vulnerability even with NIM at 1.5%. On the other hand, cost to income improved by about 156 bps and customer deposits of A$10.6b still fund 70% of the book. This suggests efficiency and funding stability are not breaking under the strain yet, even as the integration program and tech rollout continue.

After higher-than-expected integration costs and a low allowance for bad loans, are these pressures contained or early warnings? Review our risk analysis for MyState which shows 2 important warning signs

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If MyState's resilient 22.3% profit margin, 1.5% NIM and 15x P/E have you interested, register for free with Simply Wall St and add it to a Watchlist to track the share price against fair value and watch for a potential entry point. Once you own MyState or other stocks, use the Portfolio Command Center to cut through market noise and focus on the key events that matter for your holdings. For longer term context and fresh angles, tap into crowd insights through the Community and see how other investors are thinking about banks and lenders like MyState. By surfacing hidden catalysts and risks early, Simply Wall St helps you stay ahead of the market and make more confident decisions.

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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.

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