Fiserv earnings missed by $0.61, revenue fell short of estimates
Investing.com - Raymond James raised its price target on Heritage Commerce (NYSE:HTBK) to $11.50 from $11.00 while maintaining an Outperform rating following the bank’s third-quarter 2025 results. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculation.
The bank reported strong loan growth at a 5% annualized pace, balanced between commercial and industrial loans and commercial real estate, despite headwinds in single-family residential and construction portfolios. Deposit growth was even stronger at 13% annualized, primarily driven by non-interest-bearing deposits which grew at a 31% annualized rate.
Heritage Commerce’s net interest margin expanded by 6 basis points quarter-over-quarter, exceeding expectations due to improving loan yields, asset remixing, and improving funding costs. Raymond James expects the net interest margin to continue expanding even with anticipated Federal Reserve rate cuts.
The bank demonstrated strong expense control, which supported positive operating leverage, a sub-60% efficiency ratio, and a return on assets of approximately 1%. Its balance sheet remains strong with a 13.2% CET1 ratio, 9.7% tangible common equity, and significant liquidity with cash representing 13.3% of assets.
Heritage Commerce offers a 4.8% dividend yield, with InvestingPro data showing the bank has maintained dividend payments for 14 consecutive years and raised them for 9 straight years. Raymond James projects the bank will generate approximately 1% return on assets in 2026 and maintain that level in 2027, supporting low-double digit return on average tangible common equity. InvestingPro subscribers have access to 8 additional key insights about Heritage Commerce’s financial health and growth prospects.
In other recent news, Booz Allen Hamilton’s latest financial results have raised concerns among investors. The company reported its Q2 2026 earnings, which fell short of expectations with an earnings per share (EPS) of $1.49, compared to the projected $1.53. Additionally, the company reported revenue of $2.9 billion, missing the expected $2.99 billion. These figures have heightened investor apprehension regarding Booz Allen Hamilton’s financial performance.
Furthermore, BofA Securities downgraded Booz Allen Hamilton from Buy to Underperform, citing concerns about the company’s civil business segment. This segment accounts for approximately one-third of the company’s revenue and continues to face significant challenges despite a recent 7% headcount reduction and restructuring plan. BofA has adjusted its price target for the company to $90.00 from $160.00. These developments reflect a cautious outlook from analysts and investors alike.
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