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Investing.com - Keefe, Bruyette & Woods raised its price target on Third Coast Bancshares Inc (NASDAQ:TCBX) to $43.00 from $42.00 on Thursday, while maintaining a Market Perform rating on the stock.
The price target adjustment follows Third Coast’s third-quarter earnings report, which KBW described as featuring a "robust EPS beat" alongside the announcement of a $123 million acquisition of Keystone Bancshares, representing 17% of pro forma assets. This performance continues the company’s strong financial trajectory, with InvestingPro data showing impressive revenue growth of 20.25% over the last twelve months and a favorable P/E ratio of 10.56.
KBW noted the acquisition metrics appear favorable, with the deal expected to be 7% accretive with a 1.5-year earn-back period. The firm characterized Keystone as "culturally and geographically compatible" with Third Coast. With a market capitalization of approximately $509 million, this acquisition represents a significant strategic move for the bank.
The bank showed continued momentum in asset growth and profitability expansion during the quarter, according to KBW. The acquisition is expected to add approximately 30 cents to Third Coast’s 2027 earnings estimates once fully phased in.
Despite acknowledging that Third Coast shares appear "inexpensive on out-year EPS," KBW maintained its Market Perform rating, citing a balanced risk/reward profile due to execution risk from the acquisition and potential pressures from anticipated interest rate cuts.
In other recent news, Third Coast Bancshares reported its Q3 2025 financial results, which exceeded market expectations. The company achieved an earnings per share (EPS) of $1.03, surpassing the forecasted $0.84, marking a 22.62% surprise. Revenue also outperformed projections, reaching $54.48 million against the anticipated $50.97 million. These results highlight Third Coast Bancshares’ strong financial performance in the quarter. Additionally, the company’s stock experienced a 0.92% rise in premarket trading following the announcement, indicating a positive reaction from investors. Analysts had anticipated lower figures, making the actual results noteworthy. These developments are part of a series of recent updates from the company.
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