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Investing.com - Raymond (NSE:RYMD) James maintained its Market Perform rating on First Financial Bancorp (NASDAQ:FFBC), a $2.31 billion market cap bank currently trading at $24.19, following the bank’s announcement of its acquisition of privately-held Westfield Bancorp. According to InvestingPro, five analysts have recently revised their earnings estimates upward for the upcoming period.
The acquisition is expected to generate approximately 12% earnings per share accretion in 2026 with an 8% tangible book value dilution, representing a three-year earnback period. The transaction was executed at 1.4 times tangible book value, which Raymond James described as a "digestible price" for a "solid bolt-on acquisition." With a P/E ratio of 9.9x and trading below its Fair Value according to InvestingPro analysis, First Financial (NYSE:SSB) appears attractively valued in the current market.
The deal will give First Financial significant market penetration in northeast Ohio, particularly in the Cleveland area, while enhancing its existing specialty business lines with potential for fee income synergies. Raymond James noted the acquisition carries minimal integration and credit risk given its size and Westfield’s favorable historical credit metrics.
First Financial will maintain solid capital levels after the transaction closes, potentially allowing for additional merger and acquisition opportunities in the future. The acquisition has positively impacted Raymond James’ financial estimates for the company.
Despite the improved outlook, Raymond James maintained that First Financial shares are "appropriately valued," noting they currently trade at a price-to-tangible book value premium compared to peers. The bank has maintained dividend payments for 43 consecutive years, demonstrating strong financial stability. For deeper insights into First Financial’s valuation and comprehensive analysis, investors can access the detailed Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with expert analysis and actionable intelligence.
In other recent news, First Financial Bancorp reported its first-quarter 2025 earnings with an adjusted earnings per share of $0.63, meeting analysts’ expectations, though the company faced a revenue shortfall, reporting $200.38 million against the forecasted $214.8 million. Additionally, First Financial has entered into a definitive agreement to acquire Westfield Bancorp for $325 million in a cash and stock transaction, expanding its presence in Northeast Ohio. The acquisition is anticipated to be 12% accretive to earnings with a tangible book value earn-back of approximately 2.9 years. Meanwhile, RBC Capital Markets has adjusted its outlook on First Financial Bancorp shares, reducing the price target from $30.00 to $27.00, while maintaining a Sector Perform rating. Shareholders of First Financial Bancorp have approved key proposals during the Annual Meeting, including the election of directors and the ratification of Crowe LLP as the independent registered accounting firm. The company’s focus on expense management led to a 3.3% decline in non-interest expenses, and it anticipates modest loan growth with expected interest rate cuts. First Financial continues its expansion strategy, having pledged $500,000 to its Foundation to benefit local organizations in communities served by Westfield Bank.
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