On Wednesday, DA Davidson, a financial services firm, upgraded the price target for Heartland Financial (NASDAQ: HTLF) shares, increasing it to $60.00 from the previous target of $55.00. The firm maintained a Neutral rating on the stock.
The adjustment follows the third quarter of 2024 results, which led to an increase in the core earnings per share (EPS) estimate for 2024 from $4.60 to $4.65, incorporating the positive variance observed in the quarter. However, the EPS estimate for 2025 remains unchanged at $4.20.
DA Davidson's revised model for Heartland Financial includes an optimistic outlook for the company's net interest income (NII). This positive adjustment is balanced by an expectation of higher operating expenses. The firm's rationale for the new price target is based on an improvement in the trading multiples of Heartland's peers.
The new price target of $60.00 is derived from a multiple of 14.3 times the firm's 2025 EPS estimate and 1.8 times the current tangible book value (TBV). This valuation reflects the firm's analysis of Heartland Financial's financial prospects and market position.
InvestingPro Insights
Recent data from InvestingPro provides additional context to DA Davidson's upgrade of Heartland Financial (NASDAQ: HTLF). The company's market cap stands at $2.6 billion, with a P/E ratio of 27.8 over the last twelve months as of Q3 2024. This relatively high earnings multiple aligns with one of the InvestingPro Tips, which notes that HTLF is "Trading at a high earnings multiple."
InvestingPro Tips also highlight that Heartland Financial "Has raised its dividend for 9 consecutive years" and "Has maintained dividend payments for 29 consecutive years," underscoring the company's commitment to shareholder returns. This consistent dividend policy may contribute to investor confidence, potentially supporting the stock's valuation.
The stock's recent performance has been notably strong, with a 39.02% price total return over the past six months and a substantial 106.61% return over the last year. This aligns with another InvestingPro Tip indicating a "High return over the last year." Additionally, HTLF is "Trading near 52-week high," with its current price at 98.05% of its 52-week high.
For investors seeking more comprehensive analysis, InvestingPro offers 10 additional tips for Heartland Financial, providing a deeper understanding of the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.