Analysts have slightly lowered their price target for First BanCorp, moving it from $24.33 to $24.17 per share. They cite a more constrained net interest margin outlook and limited upside, given the bank's already strong performance.
Analyst Commentary
Analysts have recently revisited their outlook on First BanCorp, incorporating updated guidance and a reassessment of the bank’s growth prospects. Their commentary reflects both confidence in the bank’s core execution and caution regarding the future trajectory of earnings growth.
Bullish Takeaways
- Bullish analysts continue to see value in First BanCorp’s efficient operations and consistent earnings performance, which justifies a Buy rating for the shares.
- The company's management is viewed as having strong operational control, which contributes to First BanCorp's ability to sustain high profitability levels.
- Despite slightly lower long-term earnings forecasts, analysts maintain that the bank remains fundamentally sound with steady capital generation.
- The current share price reflects much of the recent strong execution. However, upside remains if net interest margins stabilize or improve beyond the revised estimates.
Bearish Takeaways
- Bearish analysts cite a more constrained outlook for net interest margin as a key headwind for earnings growth over the next several years.
- There is a consensus that the levers to drive meaningfully higher earnings or valuation are limited, given the bank's already high level of operational efficiency.
- Concerns persist that recent outperformance may not be sustainable if interest rate or competitive pressures further dampen revenue growth.
- Price targets have generally trended lower in light of these challenges. This reflects a less optimistic view on forward-looking returns for investors.
What's in the News
- First BanCorp. (NYSE:FBP) announces a share repurchase program, authorizing up to $200 million worth of its shares to be bought back and held as treasury shares. The program will run through the fourth quarter of 2026. (Company announcement)
- The Board of Directors of First BanCorp. has authorized a buyback plan to commence on October 22, 2025. (Company announcement)
Valuation Changes
- Consensus Analyst Price Target: decreased modestly from $24.33 to $24.17 per share.
- Discount Rate: has risen slightly from 6.78 percent to 6.96 percent, indicating a marginally higher risk premium.
- Revenue Growth: dipped from 9.59 percent to 9.05 percent, reflecting softer expectations for top-line expansion.
- Net Profit Margin: improved from 27.62 percent to 27.98 percent, showing greater projected profitability.
- Future P/E: declined from 13.0x to 12.6x, suggesting lower expected valuation multiples for forward earnings.
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