Keefe Bruyette cuts BancFirst stock price target to $132

Published 24/01/2025, 12:34
Keefe Bruyette cuts BancFirst stock price target to $132

On Friday, Keefe, Bruyette & Woods adjusted the price target for BancFirst (NASDAQ:BANF) shares, lowering it to $132 from $135, while maintaining a Market Perform rating on the stock. The adjustment follows a review of the company's fourth-quarter performance and future financial projections.

The firm noted BancFirst's fourth-quarter earnings were bolstered by a provision-driven beat, despite higher expenses resulting from an OREO write-down. Core pre-provision net revenue (PPNR) trends remained consistent with expectations, supported by net interest income and fee revenue. Despite loan paydowns impacting fourth-quarter loan growth, BancFirst concluded the year with a 5% increase in loans and successfully carried forward a 3% deposit momentum, which saw an 8% lift on a linked quarter annualized (LQA) basis. InvestingPro data reveals the company maintains a strong financial health score of 'GREAT', with particularly robust profitability metrics.

Keefe, Bruyette & Woods highlighted that while excess liquidity weighed on the net interest margin (NIM), there is potential for stabilization going into 2025. The firm expects a more gradual easing cycle to benefit BancFirst's rate-sensitive balance sheet. With an anticipation of only two rate cuts in the coming year and two in 2026, the analysts have increased their earnings estimates for 2025 and 2026 to $6.36 and $6.40, respectively.

The revised price target of $132 reflects these updated earnings expectations. BancFirst's shares are currently trading at 19 times earnings per share (EPS) and 2.8 times tangible book value (TBV). The Market Perform rating indicates that the analysts believe the stock will perform in line with the broader market.

In other recent news, BancFirst Corporation has released its latest Sustainability Report, demonstrating the company's commitment to environmental, social, and governance aspects. The report, available on BancFirst's investor relations website, provides insight into the company's initiatives in energy efficiency, community engagement, and ethical governance.

In financial news, BancFirst has declared a cash dividend of $0.46 per share on its common stock set for distribution in 2025. The company will also make a quarterly interest payment on $26.8 million worth of its 7.20% Junior Subordinated Debentures. BancFirst has also announced the appointment of Kim Ingram, CEO of Kelly Jewelers, to its Board of Directors, a move seen as a strategic enhancement to the board's expertise.

Piper Sandler, an analyst firm, has revised its earnings per share estimates for BancFirst for 2024 and 2025 upwards, despite maintaining an Underweight rating on the stock. However, the firm expressed uncertainty regarding BancFirst's plans for deploying excess capital, particularly in potential mergers and acquisitions. These are the latest developments surrounding BancFirst Corporation.

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