Popular (BPOP): Evaluating Valuation After Surging Book Value Growth and Strengthening Net Interest Margins

Popular (BPOP) is back on investor radar after pairing a fresh preferred dividend declaration with two years of widening net interest margins and rapid tangible book value growth, signaling disciplined capital deployment.

See our latest analysis for Popular.

Those cash flows to preferred holders land at a time when momentum in the common stock is still constructive, with a roughly 9.7% one month share price return supporting a strong year to date move and a standout five year total shareholder return of about 157%. This suggests investors increasingly trust Popular’s improving fundamentals rather than seeing this as a short lived bounce.

If Popular’s run has you thinking about what else could surprise to the upside, now is a good moment to scan fast growing stocks with high insider ownership for other under the radar compounders.

With earnings power, book value and capital returns all stepping up, investors now face a pivotal question: Is Popular still trading below what its fundamentals justify, or has the market already priced in the next leg of growth?

Most Popular Narrative Narrative: 12.8% Undervalued

With Popular’s shares last closing at $124.80 against a narrative fair value of $143.11, the story centers on steady earnings power and disciplined valuation assumptions.

The analysts have a consensus price target of $136.875 for Popular based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $155.0, and the most bearish reporting a price target of just $123.0.

Read the complete narrative.

Curious how a regional bank earns a premium narrative without stretching its earnings multiple, revenue growth, or margins assumptions? The key forecast levers may surprise you.

Result: Fair Value of $143.11 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Popular’s heavy Puerto Rico exposure and intensifying digital competition could quickly erode earnings momentum if growth or asset quality unexpectedly falter.

Find out about the key risks to this Popular narrative.

Build Your Own Popular Narrative

If you see the story differently or want to stress test the assumptions yourself, you can build a fully customized view in minutes: Do it your way.

A great starting point for your Popular research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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