On Tuesday, DA Davidson maintained a positive outlook on Wintrust Financial (NASDAQ:WTFC), raising the stock's price target from $125.00 to $130.00 while keeping a Buy rating. The firm's analysis indicates that Wintrust Financial is poised to continue its consistent net interest income (NII) and loan growth, with minimal unexpected credit issues.
The analyst's statement highlighted the unchanged earnings per share (EPS) forecast for 2025, reinforcing the belief in the company's ability to deliver reliable financial performance. The 2025 EPS estimate remains at $10.50, signifying confidence in the company's profitability and moderate credit risk profile.
Despite a downward revision of the 2024 core EPS estimates from $10.20 to $10.15, the firm anticipates a partial recovery in the fourth quarter of 2024 to offset the negative variance seen in the third quarter. The adjustments made to the financial model take into account reduced credit costs balanced by an increase in operating expenses.
The new price target of $130 reflects a 12.4 times multiple of the 2025 EPS estimate and 1.7 times the current tangible book value (TBV). This adjustment is also supported by improved trading multiples among peer banks, providing added visibility to Wintrust Financial's EPS outlook and justifying the increased target.
In summary, DA Davidson's revised price target for Wintrust Financial underscores the company's status as a high-quality investment with expectations of sustained NII and profitability, alongside manageable credit risk. The firm's perspective remains firm on the stock's potential, as indicated by the reiterated Buy rating and the increased price target.
In other recent news, Wintrust Financial Corporation reported an operating earnings per share (EPS) of $2.57, surpassing the consensus estimate. Piper Sandler has maintained its Overweight rating on the company's stock, while Citi reaffirmed its Buy rating, citing strong loan growth trends. Despite some operational challenges, the company's net interest income (NII) exceeded expectations, contributing to its overall growth.
Truist Securities, RBC Capital, and DA Davidson have all raised their price targets for Wintrust Financial, reflecting confidence in the company's financial performance. Additionally, Citi has increased Wintrust Financial's stock price target, citing positive trends and expectations for the company's financial performance.
The company's recent financial performance and the positive ratings from various firms are indicative of recent developments surrounding Wintrust Financial. These developments underscore the financial institution's continued strong performance and the expectation of continued revenue growth.
InvestingPro Insights
Recent data from InvestingPro adds further context to DA Davidson's positive outlook on Wintrust Financial (NASDAQ:WTFC). The company's market capitalization stands at $7.64 billion, with a price-to-earnings ratio of 11.75, suggesting a potentially attractive valuation relative to earnings. This aligns with the analyst's confidence in Wintrust's profitability and growth prospects.
InvestingPro Tips highlight Wintrust's strong dividend history, having raised its dividend for 10 consecutive years and maintained payments for 25 years. This track record of consistent shareholder returns complements the firm's projected stability in net interest income and loan growth. Additionally, the company's high return over the last year, with a one-year price total return of 54.37%, supports DA Davidson's bullish stance.
It's worth noting that Wintrust is trading near its 52-week high, with its current price at 97.82% of the peak. This performance, coupled with the analyst's increased price target, suggests market confidence in the company's outlook. For investors seeking more comprehensive analysis, InvestingPro offers 7 additional tips for Wintrust Financial, providing deeper insights into the company's financial health and market position.
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