Banner stock price target raised to $72 from $65 at Raymond James

Investing.com - Raymond (NSE:RYMD) James raised its price target on Banner Corporation (NASDAQ:BANR) to $72.00 from $65.00 on Thursday, while maintaining an Outperform rating following the bank’s second-quarter 2025 results. The new target falls within the current analyst range of $65-75, with InvestingPro data showing the stock trading at $67.21 and indicating potential upside based on its Fair Value analysis.

The firm cited Banner’s "solid 2Q25 results" and favorable core trends as key factors behind the price target increase. Raymond James highlighted the bank’s consistent performance, strong deposit base, defensive posture, and solid organic growth trajectory as particularly attractive features in the current volatile market environment. With a market capitalization of $2.33 billion and an overall financial health score rated as "GOOD" by InvestingPro, Banner demonstrates strong fundamentals. Subscribers can access 6 additional ProTips and comprehensive analysis through the Pro Research Report.

Raymond James expects Banner to maintain solid organic growth while providing downside protection through its strong asset quality and robust capital base. The firm forecasts Banner’s net interest margin (NIM) to exceed 4% in the second half of 2025, even with two anticipated Federal Reserve rate cuts.

The research note emphasized Banner’s defensive positioning, pointing to solid historical asset quality with loans that typically include strong sponsors, personal guarantees, and strong collateral. The bank maintains a 1.37% loan loss reserve ratio and robust capital with 12.6% CET1 and approximately 9.3% TCE.

Raymond James also noted that Banner’s strong capital position provides flexibility for potential capital deployment through mergers and acquisitions, securities repositioning, or additional capital return, though these possibilities are not currently included in the firm’s financial models.

In other recent news, Banner Corporation reported its second-quarter earnings for 2025, exceeding expectations with earnings per share (EPS) of $1.35, compared to the forecasted $1.30. However, the company’s revenue fell short, reaching $162.2 million against the anticipated $167.04 million. DA Davidson raised its price target for Banner Corporation to $72 from $67 while maintaining a Neutral rating, citing strong loan growth and stable net interest margins as key factors. The firm adjusted its 2025 and 2026 EPS estimates to $5.50 and $5.80, respectively, reflecting an improved outlook for net interest income and reduced expenses.

Banner’s core earnings rose to $62 million, up from $52 million in the same period last year, driven by robust growth in loan originations and core operations revenue. The company projects mid-single-digit loan growth for the remainder of 2025, with stable margins anticipated due to expected increases in loan yields. Despite the revenue shortfall, Banner’s net profits available to common shareholders improved to $45.5 million or $1.31 per diluted share, up from $1.15 per share in Q2 2024. The company remains focused on organic growth, with no immediate plans for mergers and acquisitions.

Banner’s strong performance was highlighted by an increase in loan originations and stable credit metrics, with the firm maintaining a moderate risk profile. The company continues to benefit from a strong core deposit base, which has proved resilient and loyal. Additionally, Banner’s liquidity and capital profile remain robust, supported by a low reliance on wholesale borrowing and significant off-balance-sheet borrowing capacity.

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