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On Monday, Keefe, Bruyette & Woods analysts reaffirmed their Outperform rating for UMB Financial stock (NASDAQ:UMBF), maintaining a price target of $130.00. The decision comes as the firm adjusts its model to incorporate a Series B preferred offering announced this week and anticipates calls for the Series A and subordinated debt before planned resets.
The analysts noted a slight impact on the company’s earnings per share, estimating a 1% decrease due to these adjustments. According to InvestingPro data, nine analysts have recently revised their earnings estimates upward for the upcoming period, suggesting confidence in the company’s outlook despite these changes. They expect UMB Financial to benefit from a stronger Tier 1 capital position and a more optimized capital structure.
UMB Financial continues to be highlighted as a top pick by the analysts, who cite its leading profitability metrics, including an 18% return on tangible common equity (ROTCE). Trading at a P/E ratio of 13.8x and having raised its dividend for 32 consecutive years, the stock is seen as undervalued, trading at nine times the firm’s estimated earnings for 2026.
The analysts emphasized the stock’s significant upside potential over the coming years, supported by its robust financial performance and strategic adjustments in capital management. UMB Financial’s valuation is considered attractive compared to its peers, reinforcing its position as a preferred choice in the financial sector. For deeper insights into UMB Financial’s valuation metrics and growth potential, explore the comprehensive analysis available on InvestingPro, which offers exclusive financial health scores and detailed company research reports.
In other recent news, UMB Financial Corporation has announced the pricing of a $300 million offering of Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series B. This financial move aims to manage costs by redeeming securities that are set to reprice at higher rates in the coming months. The company is preparing to redeem $111 million of Series A stock and $200 million of fixed-to-fixed rate subordinated notes due in 2030. Analyst David Long from Raymond (NSE:RYMD) James reaffirmed a Strong Buy rating on UMB Financial, setting a price target of $135.00, following investor meetings that highlighted the company’s credit performance and growth prospects.
Additionally, UMB Financial has initiated a public offering of depositary shares, with RBC Capital Markets and J.P. Morgan Securities managing the offering. The funds raised may be used for general corporate purposes, including redeeming Series A Preferred Stock. In another development, UMB Bank, a subsidiary of UMB Financial, has expanded its Corporate Trust and Agency Services by opening a new office in Costa Mesa, California. This expansion includes the addition of thirteen professionals from Wilmington Trust, strengthening UMB’s services in the region. The recent developments underscore UMB Financial’s strategic efforts to enhance its operational capabilities and financial performance.
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