DA Davidson maintains buy rating on First Interstate Bancsystems stock

On Monday, DA Davidson analysts reaffirmed their Buy rating for First Interstate Bancsystems stock (NASDAQ:FIBK) with a price target of $32.00. Currently trading at $26.77, InvestingPro analysis suggests the stock is undervalued, with analyst targets ranging from $25 to $38. The analysts expressed confidence in the bank’s potential for improving credit quality and achieving sustained organic growth under the leadership of its new CEO.

The analysts noted that First Interstate Bancsystems is expected to abstain from buyside mergers and acquisitions, focusing instead on enhancing consistency and profitability. This strategy is anticipated to contribute to above-average returns for shareholders, building on its impressive 16-year track record of consistent dividend payments and current 6.92% dividend yield.

Recent credit results from the bank indicate that while recovery is underway, it may take some time to fully materialize. According to the analysts, the bank’s trajectory will be influenced by various scenarios, including base, bull, and bear cases, which they have outlined in their report.

The DA Davidson analysts highlighted that the bank’s new CEO is likely to instill greater discipline, which is expected to drive positive trends in the company’s performance. As a result, the analysts maintain their optimistic outlook for First Interstate Bancsystems stock.

In other recent news, First Interstate BancSystem reported its Q1 2025 earnings, which fell short of expectations. The company announced earnings per share of $0.49, missing the forecasted $0.55, and revenue of $247 million, which was below the anticipated $253.5 million. Amid these financial results, the company is focusing on branch optimization and digital investments, while noting a slight improvement in net interest margin. Additionally, First Interstate BancSystem has appointed David P. Della Camera as the new Chief Financial Officer, following a planned succession strategy. Meanwhile, Piper Sandler has reaffirmed its Overweight rating on the bank, maintaining a price target of $38, citing potential increases in net interest income and strategic initiatives under CEO Jim Reuter. These developments reflect the company’s efforts to refine operations and financial performance, despite recent challenges in meeting earnings forecasts.

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