Operational Excellence And Repurchases Will Support Resilience Amid Narrowing Margins

First BanCorp’s analyst price target has been reduced slightly from $25 to $24, as analysts now anticipate more constrained net interest margin growth and limited earnings upside. This reflects updated management guidance.

Analyst Commentary

Following recent guidance updates from management, analysts have revised their views on First BanCorp’s performance and outlook. The latest research reflects shifting expectations regarding the bank’s valuation, growth prospects, and ability to execute in a challenging environment.

• Bullish analysts maintain a positive rating based on the company's continued ability to operate at a high level, even with revised margin expectations.
• The long-term earnings outlook remains constructive, with forecasts suggesting earnings per share will remain solid and support above-average valuation multiples compared to some peers.
• Strong core operations and solid management execution are considered a foundation for continued stability and resilience.

• Bearish analysts point to a more constrained net interest margin outlook, which is expected to limit earnings growth through 2026.
• The bank’s ability to offset margin pressures appears limited, resulting in reduced estimates for future profitability and valuations.
• With First BanCorp already performing near optimal operational levels, analysts see little room for substantial upside. This makes the shares less attractive for near-term appreciation.
• Several price targets have been trimmed, which reflects cautious sentiment about the pace of further growth and upside potential.

What's in the News

• First BanCorp. (NYSE:FBP) announces a share repurchase program with authorization to buy back up to $200 million worth of its shares. The program is set to conclude in the 4th quarter of 2026 (Key Developments).
• The Board of Directors has officially authorized a new buyback plan, effective October 22, 2025 (Key Developments).
• Between April 1, 2025 and August 5, 2025, the company repurchased 2,621,882 shares, amounting to 1.62% of outstanding shares for $49.95 million. The company has now completed a total buyback of 3,816,449 shares, or 2.35%, for $71.78 million under the program announced July 22, 2024 (Key Developments).

Valuation Changes

• Consensus Analyst Price Target has been reduced moderately from $25 to $24.33, reflecting updated guidance.
• Discount Rate remains unchanged at 6.78%, indicating consistent risk assumptions.
• Revenue Growth expectations have decreased from 10.23% to 9.59%, which signals a slightly slower projected expansion.
• Net Profit Margin has fallen from 29.32% to 27.62%, which suggests a narrowing of anticipated profitability.
• Future P/E has edged up slightly from 12.96x to 13.00x, which points to a minor increase in anticipated valuation multiples.