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Friday, Keefe, Bruyette & Woods reaffirmed their positive stance on Seacoast Banking Corporation (NASDAQ:SBCF), maintaining an Outperform rating and a $31.00 price target. The endorsement follows Seacoast Banking’s announcement of its acquisition of Villages Bancorporation, a central Florida-based institution with $4 billion in assets. Analysts at Keefe, Bruyette & Woods view the acquisition as a strategic move that is expected to significantly enhance Seacoast’s profitability by 2026.
The acquisition is poised to be 24% accretive to Seacoast’s 2026 earnings, assuming full realization of cost savings, and is projected to dilute tangible book value per share (TBVPS) by 9.9% with an earnback period of 2.8 years. The deal is seen as an effective use of Seacoast’s excess capital, anticipated to improve the bank’s return on assets (ROA) and return on tangible common equity (ROTCE) to 1.31% and 16.9%, respectively, up from 1.06% and 11.1%. According to InvestingPro analysis, the bank’s current ROA stands at 0.83%, with a healthy dividend yield of 2.87% and a consistent track record of raising dividends for four consecutive years.
The transaction is also expected to provide Seacoast with greater balance sheet flexibility, with the loan-to-deposit (L/D) ratio shifting to 73% from 83%, and to reinforce its unique position in the Florida market. Based on pro forma projections, which include a 2026 earnings per share (EPS) of $2.46 and a TBVPS of $15.41, Seacoast’s shares are currently trading at 10.2 times the 2026 estimated earnings and 1.63 times the pro forma tangible book value.
Keefe, Bruyette & Woods analysts believe that the market will respond positively to the acquisition announcement, considering the deal to be an excellent opportunity for Seacoast to leverage its capital surplus to substantially increase its profitability and add to its balance sheet flexibility, while also strengthening its value in the competitive Florida banking landscape. The Outperform rating reflects the firm’s confidence in the positive financial impact of the acquisition on Seacoast Banking Corporation.
In other recent news, Seacoast Banking Corporation of Florida announced its first-quarter 2025 earnings, reporting an earnings per share (EPS) of $0.38, which fell short of the expected $0.40. However, the company exceeded revenue expectations with $140.7 million, surpassing the projected $138.41 million. Seacoast Banking has also announced its strategic acquisition of Villages Bancorporation, Inc., valued at approximately $710.8 million, which is expected to close in the fourth quarter of 2025. This acquisition is projected to be 22% accretive to earnings per share by 2026. Additionally, Seacoast has received regulatory approvals for its acquisition of Heartland Bancshares, with the transaction expected to finalize around July 11, 2025. Analyst Russell Guthner from Stephens adjusted Seacoast’s price target to $26.00 from $28.00, maintaining an Equal Weight rating. During its 2025 Annual Meeting of Shareholders, Seacoast secured approval for several proposals, including the election of directors and an increase in authorized shares. These developments reflect Seacoast’s ongoing expansion strategy and efforts to enhance its market presence and financial performance.
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