On Friday, Keefe, Bruyette & Woods adjusted its price target on shares of Amerant Bancorp Inc (NASDAQ:NYSE:AMTB), reducing it to $26 from the previous $28, while keeping a Market Perform rating on the stock. The firm's decision follows Amerant Bancorp's recent quarterly financial results, which included a provision-driven miss due to nonperforming loans (NCOs) that remained elevated. Additionally, criticized loans saw a significant increase.
The bank's net interest margin (NIM) appeared to stabilize at 3.51%. Despite only modest growth, the first quarter marked the completion of a major transaction for the bank: the sale of a multi-family property in Houston, which resulted in a $400 million reduction and enabled the paydown of wholesale funding. Following these developments, Amerant Bancorp provided updated guidance during their earnings call.
The firm expressed a cautious stance on the bank's stock, noting that while the credit risk seems to be clearly defined at this stage, a positive shift in performance would be necessary for the stock to gain traction in the current market conditions. Consequently, earnings estimates for the years 2024 and 2025 have been revised to $1.60 and $2.55, respectively, taking into account the first quarter results of 2024 and the impact of the Houston franchise sale.
Amerant Bancorp's stock is currently trading at 1.07 times its tangible book value (TBV), as noted by the analyst from Keefe, Bruyette & Woods in their commentary. The revised price target and maintained rating reflect the firm's updated assessment of the bank's financial health and market position.
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