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Investing.com - Keefe, Bruyette & Woods raised its price target on City Holding (NASDAQ:CHCO) to $135.00 from $125.00 on Wednesday, while maintaining a Market Perform rating on the stock.
The increase follows what KBW described as "another strong quarter" for City Holding, with earnings beat primarily driven by net interest income and provision improvements. The firm noted that net interest margin expanded 11 basis points to 3.95% from 3.84% in the last quarter, while growth improved to 5%. The company maintains a solid return on assets of 1.82%, reflecting strong operational efficiency.
KBW highlighted improved credit metrics, including a decline in non-performing loans and an allowance for credit losses reversal, which was driven by an upgraded credit. These factors contributed to the firm raising its 2025 and 2026 earnings per share estimates by 8% and 5% to $8.70 and $8.25, respectively.
The investment firm noted that City Holding shares currently trade at a premium of 15.6 times 2026 estimated earnings per share and 3.08 times tangible book value per share.
KBW justified this premium valuation by pointing to City Holding’s consistent earnings performance, high profitability levels (2% return on assets and 22% return on tangible common equity), and tangible book value growth of 15% annually. InvestingPro analysis suggests the stock is fairly valued at current levels, with additional metrics and insights available to subscribers.
In other recent news, City Holding Co. has announced a dividend of $0.79 per share for its shareholders. The company’s Board of Directors has approved this dividend, which will be available to shareholders on record as of July 15, 2025. The payment date for the dividend is set for July 31, 2025. This decision was made public through the company’s 8-K filing with the Securities and Exchange Commission (SEC). The announcement underscores City Holding’s ongoing commitment to delivering value to its shareholders.
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