Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - Raymond (NSE:RYMD) James upgraded The Bancorp (NASDAQ:TBBK) from Outperform to Strong Buy and raised its price target to $76.00 from $71.00. The stock, currently trading at $62.78, has demonstrated strong momentum with a 33.8% return over the past year. According to InvestingPro analysis, the stock appears overvalued at current levels.
The upgrade follows investor meetings with Bancorp’s CEO Damian Kozlowski and other executives, where the company outlined plans to gain greater wallet share from fintech partners including Chime, PayPal (NASDAQ:PYPL), and Block.
Raymond James expects these initiatives to improve Bancorp’s profitability profile, projecting a 2025 ROAA of 2.6% and ROATCE of 30.2%, while simultaneously de-risking the balance sheet through remixing its loan portfolio toward more credit sponsorship fintech loans.
The firm believes market concerns about Bancorp’s Real Estate Bridge Lending portfolio are "overblown" and notes that continued progress toward resolution could potentially trigger a "massive short squeeze" that would drive shares higher.
Raymond James views Bancorp as a leader in the Banking-as-a-Service space with a competitive moat and strong regulatory framework, citing its attractive valuation and capital return plans, including $500 million in stock repurchases planned over the next 18 months.
In other recent news, The Bancorp Inc. reported its second-quarter 2025 earnings, showing a mixed financial performance. The company’s earnings per share (EPS) came in at $1.27, slightly below the expected $1.28. However, the company achieved a significant revenue milestone, with $181.24 million in revenue, surpassing the forecasted $166 million. This revenue beat highlights strong business operations despite the minor EPS miss. Additionally, the stock experienced a notable decline in aftermarket trading. These developments provide insight into the company’s financial health and market reception. Investors and analysts will likely continue to monitor The Bancorp’s performance in upcoming quarters.
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