On Wednesday, Piper Sandler maintained a Neutral stance on shares of Fulton Financial (NASDAQ:FULT), with a steady price target of $19.00. The firm's assessment followed Fulton Financial's second-quarter earnings report for 2024, which included earnings per share (EPS) of $0.52.
After accounting for one-time costs related to the recent acquisition of Republic Bank through the FDIC, the core earnings were adjusted to $0.45. This figure surpasses both the analyst's prediction of $0.41 and the consensus estimate of $0.39.
The better-than-expected results were attributed to a $0.05 improvement in net interest income (NII), a $0.03 increase in fee income, and a $0.03 reduction in provisions, although these were partially offset by a $0.07 shortfall in expenses.
Alongside the earnings, Fulton Financial's management provided an updated guide for 2024, with projected pre-provision net revenue (PPNR) at the midpoint being 5% above the current consensus and 3% higher than Piper Sandler's forecast.
The updated guidance suggests that the positive variance is largely due to higher purchase accounting accretion (PAA) than previously estimated. The report indicates that investors are likely to respond favorably to the robust NII and fee income, as well as the relatively stable credit quality, despite the slight disappointment in expense management.
In other recent news, Fulton Financial has been making strategic moves to optimize its financial performance. The company recently completed a sale-leaseback of 40 financial centers, resulting in a pre-tax gain of $20.4 million. This transaction was followed by a restructuring of its available-for-sale securities portfolio, with the sale of $345 million of investment securities. Both actions were supported by Janney, which maintained its Buy rating on Fulton Financial.
In addition to these strategic actions, Fulton Financial has also expanded with the acquisition of FRBK, a move that was positively received by various analyst firms. Stephens raised the stock price target to $17.50, maintaining an Equal Weight rating, while Keefe, Bruyette & Woods increased its price target to $19.00, retaining a Market Perform rating. DA Davidson also adjusted its outlook, increasing the price target to $18 while maintaining a Neutral rating.
In a recent public stock offering, Fulton Financial set the price at $15 per share, expecting to raise $250 million in aggregate. This offering is part of the company's efforts to support new opportunities aligned with its business strategy, particularly following its acquisition of assets and the assumption of deposits and certain liabilities from Republic First Bank (NASDAQ:FRBA). These are all recent developments that highlight Fulton Financial's proactive approach to managing its assets and liabilities.
InvestingPro Insights
Following Fulton Financial's (NASDAQ:FULT) recent earnings report, which showcased a solid performance surpassing analyst expectations, InvestingPro data provides further context to the company's financial health.
With a market capitalization of $3.42 billion and a price-to-earnings (P/E) ratio of 11.19, Fulton Financial presents a value-oriented profile in the banking sector. Notably, the company has demonstrated a significant return over the last week with a 10.65% price total return, and an impressive yearly return of 58.16%, highlighting the stock's strong momentum.
An InvestingPro Tip points out that Fulton Financial has maintained dividend payments for an impressive 43 consecutive years, which may appeal to income-focused investors, particularly with a dividend yield of 3.62%. Moreover, the stock is trading near its 52-week high, at 99.42% of this peak, reflecting investor confidence in the company's prospects.
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