DexCom earnings beat by $0.03, revenue topped estimates
On Wednesday, Evercore ISI analysts raised the price target for U.S. Bancorp (BVMF:USBC34) (NYSE: USB) stock to $49 from $44, while maintaining an In Line rating. With a current market capitalization of $69.15 billion and trading at an attractive P/E ratio of 11x, InvestingPro analysis suggests the stock is slightly undervalued. The adjustment follows a virtual meeting with U.S. Bancorp’s investor relations team, which included discussions on loan and deposit growth, fixed asset repricing, and fee trends.
Analysts noted that commercial sentiment is showing modest improvement, which aligns with U.S. Bancorp’s confidence in its fiscal year 2025 outlook. The bank, which generated $25.36 billion in revenue over the last twelve months, shows stable revenue trends, addressing investor concerns about the attainability of the company’s top-line guidance and operating leverage expectations. InvestingPro data reveals the company maintains a FAIR financial health score, with particularly strong marks in profit and relative value metrics. Loan growth is constructive, with stable line utilization expected following a first-quarter increase.
Fee trends are reportedly within expectations, supported by resilient consumer spending, while debt capital markets volume remains solid. However, analysts caution that rate shifts and tighter second-quarter spreads may affect fixed asset repricing and net interest income benefits in 2025. Despite these challenges, U.S. Bancorp is expected to maintain positive operating leverage.
The company’s credit trends are stable, and it continues to build capital, potentially allowing for stock buybacks at a pace of approximately $100 million per quarter. Although the analysts expressed a generally confident tone, they maintained their In Line rating due to limited material upside in earnings per share and valuation catalysts at this time.
In other recent news, U.S. Bancorp reported a solid first-quarter performance in 2025, with earnings per share (EPS) of $1.03, as noted by JPMorgan. Despite this, the firm maintained an Underweight rating on the stock, with a price target of $43.50, citing fluctuations in other income and mortgage servicing rights as factors affecting revenue clarity. Wells Fargo (NYSE:WFC), meanwhile, adjusted its price target for U.S. Bancorp to $50.00 but kept an Overweight rating, highlighting improvements in costs, credit, and capital. The bank’s guidance for 2025 projects revenue growth between 3% and 5%, with operational leverage showing a 270 basis point improvement in the first quarter.
Keefe, Bruyette & Woods also revised their price target to $49.00, maintaining a Market Perform rating, while acknowledging the company’s strong performance in surpassing pre-provision net revenue expectations. DA Davidson similarly reduced their price target to $49.00 but retained a Buy rating, expressing optimism about the bank’s strategic direction under new CEO Gunjan Kedia. In leadership changes, U.S. Bancorp promoted Adam Graves to senior executive vice president and head of enterprise strategy and administration, reflecting its commitment to strategic growth.
These developments illustrate the diverse analyst perspectives on U.S. Bancorp’s financial health and strategic initiatives amid an uncertain economic environment. The bank’s management remains focused on meeting medium-term profitability goals and improving operating leverage by 2025. Despite varying price targets, analysts generally recognize the bank’s efforts to navigate challenges and capitalize on growth opportunities.
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