U.S. futures subdued as government shutdown stretches into second week
On Thursday, Keefe, Bruyette & Woods analyst Catherine Mealor increased the price target on Renasant Corp (NYSE: NYSE:RNST) to $46 from the previous $45 while maintaining an Outperform rating on the shares.
The Outperform rating is reiterated based on a valuation of 10.6 times the bank’s estimated 2026 earnings and 1.6 times the projected tangible book value post-merger. Renasant Corp’s stock price target uplift to $46 reflects these expectations and the belief in the company’s promising financial trajectory. InvestingPro subscribers can access additional insights, including the fact that Renasant has maintained dividend payments for 32 consecutive years, currently offering a 2.32% yield. The platform reveals several more ProTips and detailed metrics in its comprehensive Pro Research Report, available for over 1,400 US stocks. InvestingPro subscribers can access additional insights, including the fact that Renasant has maintained dividend payments for 32 consecutive years, currently offering a 2.32% yield. The platform reveals several more ProTips and detailed metrics in its comprehensive Pro Research Report, available for over 1,400 US stocks.
According to Mealor, the recent financial performance of Renasant Corp was bolstered by provision and taxes, which led to earnings that met expectations when excluding non-recurring items. While acknowledging headwinds from fees and expenses in the current quarter, Mealor noted that higher interest rates should help mitigate these challenges.
Looking ahead, the analyst maintains a positive outlook on the bank’s profitability, particularly if the FBMS deal closes earlier than anticipated. Mealor suggested that an accelerated deal closure could hasten the realization of profitability improvements, a prospect she finds appealing.
In her commentary, Mealor stated, "We’re encouraged by NIM and growth trends, believing both companies (FBMS/RNST) will bring solid PPNR improvement into deal close." She further elaborated on the financial forecast, leaving the 2025 earnings estimate unchanged at $2.95 but increasing the 2026 estimate by 2% to $3.53.
The Outperform rating is reiterated based on a valuation of 10.6 times the bank’s estimated 2026 earnings and 1.6 times the projected tangible book value post-merger. Renasant Corp’s stock price target uplift to $46 reflects these expectations and the belief in the company’s promising financial trajectory.
In other recent news, Renasant Corporation’s financial performance has surpassed expectations, with a reported strong earnings of $72.5 million or $1.18 per diluted share in the third quarter. This increase was significantly boosted by an after-tax gain of $39 million from the sale of an insurance agency. In addition, the company experienced an increase of $6 million in net interest income due to higher loan yields, and total deposits grew by over $285 million.
Renasant Corporation also received approval for a merger with The First Bancshares (NYSE:FBMS), Inc., an event that has received overwhelming shareholder support and is expected to close in the first half of 2025. Analysts from Raymond (NSE:RYMD) James and Keefe, Bruyette & Woods have maintained their Outperform rating on Renasant, highlighting the potential profitability enhancement from the upcoming acquisition.
In terms of executive leadership, Renasant has announced significant changes, including the transition of C. Mitchell Waycaster from his CEO role as part of a succession strategy. Waycaster’s salary will be adjusted to 60% of its value prior to the transition date, and he will also receive a $100,000 retention bonus and equity awards for 2025 and 2026. These recent developments underscore Renasant’s ongoing efforts to adapt and grow in the ever-evolving banking landscape.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.