On Thursday, Nicolet Bankshares (NASDAQ:NCBS) (NYSE: NIC (NASDAQ:EGOV)) received a price target increase from Maxim Group firm after reporting robust second-quarter earnings. The new price target is set at $120, up from the previous $95, while the firm continues to recommend a Buy rating for the stock.
Nicolet Bankshares announced its second-quarter results earlier this week, on Tuesday, showcasing a core earnings per share (EPS) of $1.89, which excludes non-recurring gains of $0.03. This figure surpassed both the consensus estimate of $1.66 and the firm's own forecast of $1.69.
The outperformance is attributed to an expanded net interest margin (NIM), which rose by 9 basis points, a 2% increase in loan growth, and sustained strong credit quality, evidenced by negligible net charge-offs.
In light of these results, the firm has adjusted its 2025 EPS estimate for Nicolet Bankshares to $8.50, up from the previous estimate of $7.75. This revision is based on the solid performance in the second quarter and the anticipation of rate cuts by the Federal Reserve.
The new price target of $120 reflects a 14.1 times multiple of the revised 2025 EPS estimate, a slight increase from the 13.3 times multiple based on the 2024 estimate. The firm justifies this premium valuation for Nicolet Bankshares by pointing to the bank's history of accretive acquisitions and the recent higher valuations observed among peer institutions.
In other recent news, Nicolet Bankshares has demonstrated a robust financial performance, with notable highlights in its recent earnings and revenue results. The bank's second quarter performance exceeded analyst expectations, primarily driven by strong balance sheet expansion, net interest margin performance, and controlled operating expenses. It reported a significant recovery in deposit trends and a 14% year-over-year increase in Wealth Management fees in Q2 of 2024.
Furthermore, Nicolet Bankshares announced a 12% increase in its dividend, now set at $0.28 per share, indicating the bank's commitment to returning capital to its investors. In response to these developments, Stephens raised the bank's target to $110, maintaining an Equal Weight rating, while Piper Sandler increased the price target to $104, also with a Neutral rating.
However, Stephens later revised its price target, lowering it to $88 from the previous $92, following Nicolet's first-quarter earnings report for 2024, which exceeded expectations with an operating earnings per share of $1.72.
Despite the positive earnings, the bank saw a decrease in non-interest-bearing deposits during the quarter. These are some of the recent developments from Nicolet Bankshares, reflecting the company's strategic efforts to enhance shareholder value.
InvestingPro Insights
Following the upbeat earnings report from Nicolet Bankshares (NYSE: NIC), the market has responded positively, with a notable surge in the stock price. According to the latest data from InvestingPro, Nicolet Bankshares is trading near its 52-week high, with a current price just 0.83% below this level. This aligns with the investment firm's increased price target and underscores the market's confidence in the bank's performance.
InvestingPro Tips suggest that analysts are optimistic about Nicolet Bankshares' near-term prospects, as evidenced by four analysts revising their earnings upwards for the upcoming period. Moreover, the stock is trading at a low P/E ratio relative to near-term earnings growth, which could indicate that it's undervalued given its growth potential. This is particularly relevant given the firm's revision of its 2025 EPS estimate, suggesting that the current stock price may offer an attractive entry point for investors.
InvestingPro Data highlights a P/E ratio of 13.51 and a PEG ratio of 0.2, which may appeal to value investors looking for growth at a reasonable price. Additionally, the company has demonstrated strong revenue growth of 29.2% over the last twelve months as of Q2 2024. For those interested in diving deeper into Nicolet Bankshares' financials, more InvestingPro Tips are available, which can be accessed with a subscription. Use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, and gain access to a total of 12 additional InvestingPro Tips for Nicolet Bankshares.
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