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Investing.com - Keefe, Bruyette & Woods lowered its price target on BCB Bancorp (NASDAQ:BCBP) to $9.50 from $10.50 while maintaining a Market Perform rating.
The research firm cited ongoing credit challenges at the bank, noting that non-performing assets stand at 3.50% and net charge-offs reached 0.78%, which continue to overshadow positive developments. Despite these challenges, the bank maintains a notable 7.28% dividend yield and has sustained dividend payments for 20 consecutive years, according to InvestingPro data.
KBW acknowledged some improvements, including balance sheet remix and a higher net interest margin (NIM), which helped BCB Bancorp deliver net interest income results that exceeded the firm’s expectations.
The bank is expected to continue shrinking its balance sheet while its net interest margin will likely drift modestly higher, according to KBW’s analysis.
Despite the reduced price target, KBW believes downside for the stock is limited given its discounted valuation at 0.52 times tangible book value per share, though shares may remain range-bound in the near term as credit costs stay elevated due to the Business Express portfolio.
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