Raymond James maintains RVSB stock Outperform with $6.25 target

On Tuesday, Raymond (NSE:RYMD) James expressed continued confidence in Riverview Bancorp (NASDAQ:RVSB), maintaining an Outperform rating and a price target of $6.25, representing a 14% upside from the current price of $5.46. The firm’s optimism follows recent investor meetings with Riverview’s management, which highlighted the bank’s growth acceleration and strategic capital deployment options. According to InvestingPro data, the bank, with a market capitalization of $115.4 million, has maintained dividend payments for 11 consecutive years, demonstrating consistent shareholder returns.

The meetings centered on Riverview’s commitment to growth, emphasizing that it would not come at the expense of its strong credit culture. The bank’s recent initiatives, such as hiring key personnel, introducing new and expanded products, and enhancing systems and processes, are expected to help reverse the recent 12.5% revenue decline observed in the latest reporting period. InvestingPro analysis indicates the bank currently maintains a WEAK overall financial health score, suggesting these growth initiatives come at a crucial time. Additionally, Riverview has significantly improved its treasury management offerings, which Raymond James believes will support the growth of low-cost core deposits and client acquisition, especially in the commercial and industrial (C&I) sector, which is a primary focus for the bank.

Raymond James analysts noted that while the growth strategy will take time to fully realize, they anticipate an improving growth trajectory and expanding net interest margin (NIM) to drive substantial positive operating leverage. Moreover, the bank is exploring various opportunities to accelerate this progress, including share repurchases and restructuring its available-for-sale (AFS) and held-to-maturity (HTM) securities portfolio. Riverview is also considering mergers and acquisitions (M&A) as a part of its strategy. Despite the challenges of deal-making at current valuations, analysts expect Riverview to be actively engaged in M&A over time.

The firm also highlighted Riverview’s strong asset quality and potential for capital deployment as factors that contribute to the bank’s inherent franchise value. According to Raymond James, the current valuation of Riverview at 0.73 times book value does not fully reflect the bank’s value, given its strong core deposit franchise and improving loan growth story. InvestingPro analysis suggests the stock is currently fairly valued based on its proprietary Fair Value model, with analysts forecasting profitability for the current fiscal year. As a result, Raymond James views the risk-reward proposition for Riverview Bancorp’s stock favorably. For additional insights and metrics, investors can access more than 30 financial indicators and analysis tools through InvestingPro.

In other recent news, Riverview Bancorp has received an updated price target from Raymond James, which now stands at $6.25, up from $5.25. This adjustment follows Riverview Bancorp’s third fiscal quarter of 2025 results, which showed signs of accelerated growth. The bank reported expanding loan production and an improved client pipeline, while maintaining underwriting standards. Riverview Bancorp has also enhanced its back office processes and treasury management offerings, aiming to boost productivity and client acquisition. Despite elevated payoffs affecting the quarter, growth is expected to re-accelerate to a mid-single digit pace, potentially aided by pool purchases. Additionally, the bank optimized its funding base, reducing funding costs by 10 basis points during the quarter. Riverview Bancorp’s strong capital position, with a Common Equity Tier 1 ratio of 15.2%, allows for continued share repurchases, estimated at $750,000 per quarter through fiscal year 2026. Raymond James maintains an Outperform rating, highlighting the bank’s attractive valuation and potential for future growth.

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