Huntington Bancshares stock rating reiterated at Buy by DA Davidson

Investing.com - DA Davidson has reiterated a Buy rating on Huntington Bancshares (NASDAQ:HBAN) with a price target of $21.00 ahead of the Veritex acquisition closing. According to InvestingPro data, the stock currently trades at $15.64, with analyst targets reaching as high as $23, suggesting significant upside potential. The bank, currently valued at $22.62 billion, appears undervalued based on InvestingPro’s Fair Value analysis.

The firm highlighted that Huntington is delivering peer-leading loan and deposit growth, with top quartile return on tangible common equity (ROTCE) at 17.8%, which exceeds the company’s 2027 goal of 16-17%. This strong performance is supported by robust revenue growth of 11.82% and a reliable dividend yield of 4%, with InvestingPro noting the bank has maintained dividend payments for 55 consecutive years.

DA Davidson forecasts pre-provision operating leverage (POL) of approximately 330 basis points in 2025, following two years of negative performance in this metric.

The momentum is expected to continue into 2026 as Huntington projects its net interest margin to increase by approximately 10 basis points on a full-year basis, alongside mid-to-high single-digit average loan growth, leading to another strong year in net interest income growth on a stand-alone basis.

The Veritex (NASDAQ:VBTX) acquisition is scheduled to close Monday, and while no revenue enhancements were included in the deal metrics, Huntington sees significant opportunities from the combination.

In other recent news, Huntington Bancshares Incorporated announced the completion of its merger with Veritex Holdings, Inc., expanding its presence in Texas. This transaction increases Huntington’s assets to approximately $223 billion, with $176 billion in deposits and $148 billion in loans as of September 30, 2025. The merger adds 31 Veritex branches to Huntington’s network, bringing its total to over 1,000 branches. In financial updates, the company maintains its quarterly dividend of $0.155 per share, payable on January 2, 2026. Analysts have varied views on Huntington’s stock, with Keefe, Bruyette & Woods raising its price target to $20, citing strong business momentum. Conversely, Wolfe Research lowered its target to $19 following the third-quarter earnings report, yet maintained an Outperform rating. Jefferies also adjusted its target to $20, acknowledging solid third-quarter results and an increase in full-year net interest income growth guidance. These developments highlight Huntington’s strategic growth and financial stability.

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