Triumph Financial stock rating raised to Market Perform

On Thursday, Keefe, Bruyette & Woods analyst Tim Switzer upgraded Triumph Financial shares from Underperform to Market Perform, adjusting the price target to $74.00 from the previous $80.00. Switzer’s assessment followed Triumph Financial’s announcement of acquiring Greenscreens.ai, a move he believes strategically aligns with the company’s goals despite the premium paid.

Switzer noted that Triumph Financial is taking on a notable expense, with the acquisition price representing about 10% of the company’s $1.61 billion market capitalization. He sees the acquisition as a logical step, explaining that the integration of Greenscreens.ai’s pricing model with Triumph Financial’s leading data will result in a powerful pricing tool for logistics companies. InvestingPro subscribers can access detailed financial health metrics and 8 additional key insights about Triumph Financial’s current market position and growth potential through the comprehensive Pro Research Report.

The addition of Greenscreens.ai is expected to bolster Triumph Financial’s newly established Intelligence segment. Switzer pointed out that this service has been in high demand among freight brokerage clients, and developing a similar solution independently would have taken Triumph Financial several years.

While Switzer’s estimates for Triumph Financial remain largely unchanged, he cautioned that capital levels are projected to drop significantly. He also hinted at the possibility of future downward revisions to his model once it accounts for related amortization expenses.

Switzer concluded his remarks by stating that much of the previous Underperform thesis for Triumph Financial has already played out, which contributed to his decision to upgrade the stock to Market Perform.

In other recent news, Triumph Financial has announced its agreement to acquire Greenscreens.ai for $160 million, with $140 million in cash and $20 million in stock. This acquisition is intended to enhance Triumph’s data-driven offerings in the transportation sector. In financial developments, Triumph Bancorp (NASDAQ:TFIN), a part of Triumph Financial, reported a significant miss in its fourth-quarter 2024 earnings, with earnings per share (EPS) at $0.13, falling short of the expected $0.24, and revenue reaching $103.56 million, below the forecasted $108.71 million. Following these results, analysts have adjusted their outlooks: DA Davidson reduced its price target for Triumph Financial to $82 from $100 while maintaining a Neutral rating, citing challenges such as lower net interest income and moderated fee growth expectations. Similarly, Keefe, Bruyette & Woods cut its price target to $80 from $85, maintaining an Underperform rating due to near-term challenges expected to persist through the first half of 2025. Despite these challenges, Triumph Financial continues to focus on technology innovations, such as AI-driven invoice processing, to improve operational efficiency. The company also aims to increase its market share in factoring and expects meaningful revenue growth from its Intelligence segment by late 2026.

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