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Investing.com - Piper Sandler has raised its price target on Bank of Marin Bancorp (NASDAQ:BMRC) to $25.00 from $21.00 while maintaining a Neutral rating on the stock. The bank, currently trading at $24.95 with a market capitalization of $401 million, has shown strong momentum with an 8.24% gain over the past week. According to InvestingPro analysis, the stock appears to be fairly valued at current levels.
The adjustment follows Bank of Marin’s announcement of the sale of $186 million in available-for-sale securities, representing approximately 46% of its total securities portfolio. The sold securities had an average yield of 1.96%, and the bank has reinvested the proceeds into higher-yielding securities with a weighted average rate of 5.00%. Notably, the bank has maintained dividend payments for 22 consecutive years, with a current dividend yield of 4.16%, demonstrating its commitment to shareholder returns.
Piper Sandler estimates this transaction will boost Bank of Marin’s net interest income by approximately $5.7 million annually and expand its net interest margin by 16 basis points. The firm projects the move will be $0.26 or 15% accretive to the consensus 2026 estimated earnings per share of $1.74.
The bank will record a $19 million pretax loss on the securities sale, which Piper Sandler estimates can be earned back in 3.4 years, slightly better than management’s 4-year guidance. The bank’s capital position remains solid with pro forma CET1 of 14.9% (down from 15.5%), TRBC of 16.1% (from 16.7%), while TCE remains unchanged at 9.82%. With a beta of 0.83, the stock has historically shown lower volatility than the broader market. Get deeper insights into Bank of Marin’s financial health and growth prospects with InvestingPro, which offers exclusive analysis and 6 additional ProTips for this stock.
Piper Sandler has revised its earnings per share estimates for Bank of Marin to $0.68 for 2025 and $1.85 for 2026, compared to previous estimates of $1.42 and $1.60 respectively. The new $25 price target reflects 13.5x the firm’s 2026 EPS estimate, consistent with Bank of Marin’s historical 3-turn premium to peers.
In other recent news, Bank of Marin Bancorp has announced a strategic balance sheet repositioning, selling $186 million in available-for-sale securities with an average yield of 1.96% and reinvesting the proceeds at a yield of approximately 5.00%. This move is expected to enhance the bank’s net interest margin by 13 basis points and contribute $0.20 to earnings per share over the next four quarters. Despite recording an estimated pre-tax loss of $19 million from the sale, the bank maintains a strong capital position with a pro-forma total risk-based capital ratio above 16%. In its Q1 2025 earnings report, Bank of Marin Bancorp reported earnings per share of $0.30, slightly missing the forecast of $0.31, and revenue of $27.82 million, falling short of the expected $27.99 million. The company’s net income rose by 67% year-over-year, with total deposits increasing by $82 million from the previous quarter. Additionally, Keefe, Bruyette & Woods raised its price target for Bank of Marin Bancorp to $27.00, maintaining an Outperform rating due to the bank’s balance sheet repositioning. The bank also announced a change in its independent auditor to Baker Tilly US, LLP following a merger involving its previous auditor, Moss Adams LLP.
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