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On Friday, Keefe, Bruyette & Woods maintained a positive stance on Truist Financial (NYSE:TFC), reiterating an Outperform rating and a price target of $47.00. The firm’s analysts highlighted the company’s progress after a meeting with Truist’s top executives, including CFO Mike Maguire, Treasurer Freddy Itayem, Head of Consumer & Small Business Banking Dontá Wilson, and Chief Risk Officer Brad Bender. The discussion with the management team reinforced a constructive view of the bank’s prospects.
Keefe, Bruyette & Woods analysts were encouraged by Truist’s reaffirmation of its financial outlook amid a favorable interest rate environment. The firm anticipates that Truist will benefit from several intermediate factors, such as the repricing of underperforming fixed-rate assets and an increase in share buybacks. These elements are expected to contribute to the financial institution’s performance in the near term.
Despite the presence of positive catalysts and an enhanced balance sheet, Truist Financial’s shares, with a market capitalization of $51.86 billion, are currently trading at a 25% discount compared to its peers based on price to tangible book value (P/TBV) and 6% on projected 2026 earnings. InvestingPro analysis suggests the stock is currently undervalued, aligning with the broader market’s discounted view of the company. For a deeper understanding of Truist’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro. Keefe, Bruyette & Woods believe that this valuation gap will narrow, with Truist’s stock moving from a discount to a premium relative to its competitors. This shift is anticipated as the bank continues to improve its net interest margin (NIM) and balance sheet growth, coupled with consistent buybacks aimed at generating higher returns for shareholders.
The analysts at Keefe, Bruyette & Woods expressed confidence that these strategic moves would enhance Truist Financial’s market position. The bank’s focus on strengthening its balance sheet, both in terms of capital and liquidity, is seen as a key driver for future growth and an increased valuation by the market.
In other recent news, Truist Financial Corporation reported its first-quarter 2025 earnings, revealing an operating earnings per share of $0.89, which surpassed consensus estimates by $0.03. The company’s revenue remained stable at $4.95 billion, aligning with forecasts. The earnings report highlighted a 1.1% increase in average loans and a $2.2 billion rise in average deposits, contributing to a net income of $1.2 billion. Truist’s management has updated its 2025 outlook, now forecasting 50-150 basis points of positive operating leverage, reflecting expectations of lower fixed-rate asset repricing and flat investment banking revenue. In a related development, Stephens analyst Terry McEvoy lowered Truist’s stock price target to $46 from $48 while maintaining an Overweight rating, citing strategic initiatives and potential for increased capital return. Furthermore, Truist announced a quarterly cash dividend for common stockholders of $0.52 per share, with various dividends declared for preferred stock series as well. In corporate governance, Jonathan Pruzan was appointed to Truist’s board of directors, enhancing the company’s leadership team. Lastly, during the 2025 Annual Meeting of Shareholders, Truist shareholders approved executive pay and reappointed PricewaterhouseCoopers LLP as the independent auditor.
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