Stock market today: Stocks fall as investors rotate out of tech into Jackson Hole
On Wednesday, DA Davidson adjusted its outlook on BOK Financial (NASDAQ:BOKF), reducing the price target to $114 from the previous $122 while maintaining a Buy rating on the stock. The $5.78 billion market cap company, currently trading at a P/E ratio of 10.4x, has seen its stock decline by nearly 17% year-to-date. The adjustment followed the release of quarterly results that were negatively impacted by weaker performance in brokerage and trading activities, as well as higher-than-expected loan paydowns. These factors dimmed the positive effects of a solid net interest margin (NIM) expansion, growth in fee income from other business areas, and robust credit trends. According to InvestingPro analysis, the stock is currently trading near its Fair Value.
Analysts at DA Davidson highlighted that management at BOK Financial has revised its full-year fee income guidance downward. However, they have not altered their net interest income (NII) forecast or the overall revenue forecast, which anticipates mid-to-upper single-digit growth. The analysts expressed skepticism regarding the company’s ability to meet these targets given the current financial headwinds. InvestingPro data reveals that analyst targets for the stock range from $100 to $123, with two analysts recently revising their earnings expectations downward for the upcoming period.
Despite the challenges faced in the latest quarter, BOK Financial is recognized for maintaining a strong balance sheet. With the company’s stock trading below $100, management has indicated plans to increase activity in share repurchases, aiming to leverage the stock’s current valuation to the benefit of shareholders.
The firm’s stance on BOK Financial reflects a belief in the company’s underlying value and resilience, despite the short-term pressures that have necessitated a revision of the price target. The Buy rating suggests that DA Davidson sees potential for the stock to perform well over time, even as it navigates through a period of adjustment.
In other recent news, BOK Financial Corporation reported its first-quarter 2025 earnings, revealing an earnings per share (EPS) of $1.86, which fell short of the forecasted $1.98. The company’s revenue of $500.37 million also missed the anticipated $520.04 million. Analysts from Keefe, Bruyette & Woods, Stephens, and Raymond (NSE:RYMD) James have all adjusted their price targets for BOK Financial, with Keefe, Bruyette & Woods lowering it to $101, Stephens to $110, and Raymond James to $105. These revisions reflect the company’s underperformance in earnings and revenue expectations, primarily due to lower fee income and trading fees.
Despite the earnings miss, BOK Financial maintains its full-year revenue outlook, expecting a significant pickup later in the year. The company is also incorporating a new mortgage finance business into its fiscal projections, which is anticipated to launch by the end of the year. Analysts have highlighted the bank’s strong capital levels and low loan-to-deposit ratio, which position it as a relatively safe investment. BOK Financial’s strategic focus includes plans for more active share repurchase in the second quarter and continued expansion in its core business areas.
Raymond James noted that BOK Financial’s shares are seen as a relative safe haven due to their solid operating performance and discounted valuation compared to peers. The bank’s performance will continue to be monitored by investors as it navigates through the evolving financial landscape.
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