Raymond James lifts FirstSun stock target to $46

Published 29/01/2025, 20:48
Raymond James lifts FirstSun stock target to $46

FirstSun has recently taken steps to enhance its growth potential, including submitting applications for new branches in San Diego and Los Angeles, as well as actively recruiting lenders. These efforts aim to stimulate above-peer loan growth and effectively utilize the company’s excess capital, with current Common Equity Tier 1 (CET1) and Tangible Common Equity (TCE) ratios at 13.2% and 11.8%, respectively. The analyst concludes by reiterating a positive view on the risk-reward profile for FirstSun shares. The stock has demonstrated solid momentum with a year-to-date return of 2.05% and a one-year return of 13.53%. For deeper insights into FirstSun’s growth potential and comprehensive financial analysis, visit InvestingPro. The stock has demonstrated solid momentum with a year-to-date return of 2.05% and a one-year return of 13.53%. For deeper insights into FirstSun’s growth potential and comprehensive financial analysis, visit InvestingPro.

FirstSun’s recent performance was noted for its robust revenue growth and a slight decrease in core noninterest expenses. However, the company’s forecast suggests a slower pace in loan and deposit growth and an uptick in noninterest expense growth compared to earlier projections and consensus. Despite these adjustments, the analyst remains optimistic due to an improved net interest margin (NIM), net interest income, and a lower ratio of net charge-offs (NCO) to loan loss reserve. These factors contribute to an increased earnings per share (EPS) estimate for 2025, with InvestingPro data showing the company maintains healthy profitability metrics, including an 8% return on equity and a reasonable P/E ratio of 15.35x. Unlock 5+ additional ProTips and comprehensive financial metrics with InvestingPro.

The 2026 EPS estimate has been marginally reduced, reflecting a smaller balance sheet and higher noninterest expenses than previously anticipated. Nonetheless, the outlook for FirstSun remains strong, with the stock trading at a discount relative to its peers and an addition to the Russell 2000 index expected within the year. The company’s profitability continues to be robust, supported by its commercial and industrial (C&I) heavy business mix which is poised to benefit from ongoing investments in personnel and branch expansion.

FirstSun has recently taken steps to enhance its growth potential, including submitting applications for new branches in San Diego and Los Angeles, as well as actively recruiting lenders. These efforts aim to stimulate above-peer loan growth and effectively utilize the company’s excess capital, with current Common Equity Tier 1 (CET1) and Tangible Common Equity (TCE) ratios at 13.2% and 11.8%, respectively. The analyst concludes by reiterating a positive view on the risk-reward profile for FirstSun shares.

In other recent news, FirstSun Capital Bancorp (NASDAQ:CBNK) has been the subject of two significant developments. Firstly, the company’s merger agreement with HomeStreet (NASDAQ:HMST), Inc. was terminated. The agreement, initially announced on January 16, 2024, and later amended on April 30, 2024, was dissolved mutually by both parties. The financial terms or any penalties associated with the termination have not been disclosed.

Secondly, the company announced the resignation of board member Christopher C. Casciato, effective December 19, 2024. Casciato, who represented Lightyear Fund III, L.P. on FirstSun’s board, stepped down without citing any disagreement with the company. The company has yet to announce a successor or detail any changes to the board’s composition following Casciato’s resignation.

These are recent developments concerning FirstSun Capital Bancorp. According to an analysis by InvestingPro, FirstSun maintains a "GOOD" overall financial health score. However, the impact of these recent changes on FirstSun’s governance and strategic direction remains to be seen.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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