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On Monday, Keefe, Bruyette & Woods maintained a positive stance on South State Corporation (NYSE:SSB), reiterating an Outperform rating and a $120.00 price target. The firm’s analysts recently met with South State in Boston and expressed continued confidence in the bank’s performance and strategic initiatives.
South State is recognized for its strong profitability metrics, including a return on assets (ROA) of 1.3% and a return on tangible common equity (ROTCE) of 20%. The bank also boasts robust capital levels, with a common equity tier 1 (CET1) ratio of 11%. Analysts at Keefe, Bruyette & Woods noted these factors as key indicators of the bank’s solid financial position.
The integration of Independent Bank (NASDAQ:INDB) of Texas (IBTX), which is set to complete its conversion this weekend, was highlighted as progressing smoothly. The successful merger is expected to enhance South State’s growth and profitability prospects, particularly in the second half of 2025.
Keefe, Bruyette & Woods also underscored South State’s ability to sustain its net interest margin (NIM) within the 3.85-3.90% range in the near term, regardless of potential interest rate cuts this year. This stability in NIM is considered a positive sign for the bank’s earnings outlook.
The favorable assessment is further supported by South State’s valuation, which is currently trading at 9 times the estimated 2026 earnings per share (P/E). The analysts’ continued Outperform rating suggests they believe the bank’s stock will perform better than the overall market or sector in the foreseeable future.
In other recent news, South State Corporation reported strong financial results for the first quarter of 2025, exceeding analysts’ expectations. The company announced an earnings per share (EPS) of $2.15, significantly surpassing the anticipated $0.88, and achieved revenues of $630.64 million, well above the forecasted $611.62 million. These results were bolstered by a net interest margin of 3.85%, which exceeded the company’s guidance. Additionally, South State completed the integration of Independent Bank, marking a strategic expansion move.
In analyst updates, Jefferies initiated coverage of South State with a Buy rating and a price target of $110, citing the company’s strong presence in Southern U.S. markets and robust credit quality. Meanwhile, Citi adjusted its price target for South State from $123 to $113, maintaining a Buy rating despite recent stock underperformance. Analyst Benjamin Gerlinger highlighted the company’s strong credit profile and capital base as key factors for potential outperformance.
South State’s recent activities also included a securities restructure, a branch sale and lease-back deal, and observed negative core loan growth trends. The management team reaffirmed their guidance, expecting strong return on tangible common equity and EPS growth. These developments reflect South State’s strategic initiatives and the evolving financial landscape in which it operates.
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