On Friday, Canadian Western Bank ’s (TSX:CWB:CN) (OTC: CBWBF) stock price target was reduced by Jefferies to Cdn$63.00, down from the previous Cdn$69.00, while the Hold rating on the stock remained unchanged. The adjustment follows Canadian Western Bank’s fourth-quarter performance, which missed expectations.
Despite the Q4 shortfall, the bank’s stock has shown an upward trend. This resilience is attributed to the announcement that the legal claim which had delayed the bank’s reporting would not significantly impact its financials and is considered an isolated issue. Investors are also closely monitoring the progress of the pending North American deal approval.
The bank’s management has provided insights into the future, expecting credit losses to stay high in the first half of 2025 but to decrease gradually thereafter. In addition, management anticipates strong top-line growth, which will be supported by margin expansion. They also forecast positive operating leverage throughout the year.
The statement from Jefferies reflects a cautiously optimistic outlook for Canadian Western Bank, acknowledging the bank’s potential for growth despite the near-term challenges it faces with elevated credit losses. The bank’s management remains confident in their strategy to deliver solid financial performance moving forward.
Investors and market watchers will likely continue to track Canadian Western Bank’s progress, particularly in relation to the anticipated North American deal and the bank’s ability to manage credit losses while striving for growth in the upcoming year.
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