On Friday, Piper Sandler expressed continued confidence in F.N.B. Corporation (NYSE:NYSE:FNB), maintaining an Overweight rating and a price target of $17.00. The financial institution reported its third-quarter earnings for 2024, with earnings per share (EPS) of $0.30.
After adjusting for a loss from the sale of a performing auto loans portfolio, Piper Sandler identified a core EPS of $0.34. This figure was slightly below both the firm's expectations and the consensus by $0.01, attributed to increased expenses and provisioning, slightly mitigated by stronger revenues.
F.N.B. Corporation's quarter was marked by a notable 5% linked quarter unannualized growth in deposits. This growth contributed to a reduction in the loan-to-deposit (LTD) ratio, which decreased from 96% to 92% compared to the previous quarter. The solid deposit increase was highlighted as a positive aspect of the quarter's performance.
Despite the earnings miss, Piper Sandler does not anticipate significant movement in F.N.B. Corporation's share price. The firm suggests that the stock's direction will likely hinge on the finer details and executive commentary provided during the earnings call scheduled for 8:30 AM ET.
The earnings call is expected to offer further insights into the company's financial health and future outlook. Piper Sandler's commentary suggests a neutral short-term impact on the stock from the third-quarter results, with strong deposit growth offering a silver lining amidst the slight earnings shortfall.
In other recent news, F.N.B. Corporation reported its third-quarter earnings, which were slightly below analyst estimates, while its revenue surpassed expectations. The company announced adjusted earnings per share of $0.34, falling just under the consensus estimate of $0.35. However, it reported revenue of $413.02 million, beating analyst projections of $410.78 million.
F.N.B.'s net interest income saw a 2.4% increase, reaching $323.3 million, driven by higher earning asset yields and loan growth. The company's total deposits at the end of the period also increased by $1.8 billion, or 5.1%, from the previous quarter, reaching $36.8 billion.
In addition, F.N.B. reported a record non-interest income of $89.7 million, a 10% increase from the same quarter last year. The company attributed this growth to strong contributions across its diverse business model. Lastly, F.N.B.'s CET1 capital ratio at the end of the quarter was 10.4%, a slight increase from 10.2% in the previous quarter.
InvestingPro Insights
F.N.B. Corporation's financial landscape presents a mixed picture, complementing Piper Sandler's analysis. According to InvestingPro data, the company's P/E ratio stands at 12.52, suggesting a relatively modest valuation compared to industry peers. This could align with Piper Sandler's Overweight rating, indicating potential upside.
The company's dividend yield of 3.23% and its impressive track record of maintaining dividend payments for 50 consecutive years, as highlighted by an InvestingPro Tip, underscore F.N.B.'s commitment to shareholder returns. This consistent dividend policy may provide some stability for investors, especially in light of the slight earnings miss noted in the article.
However, another InvestingPro Tip points out that F.N.B. suffers from weak gross profit margins. This could be a factor contributing to the earnings shortfall mentioned in the Piper Sandler report and may warrant attention during the upcoming earnings call.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights that could provide further context to F.N.B.'s financial position and future prospects.
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