Simmons First National (SFNC): Evaluating Valuation After Q3 Miss and New Analyst Coverage

Simmons First National (SFNC) reported third-quarter earnings and revenue that came in a bit under market forecasts, as investors weighed the company’s latest financials along with new coverage from a prominent financial institution.

See our latest analysis for Simmons First National.

Simmons First National’s share price has drifted down 19.6% so far this year, with a 1-year total shareholder return of -26.2%. This reflects persistent caution despite the company’s efforts to sharpen profitability and efficiency. While new analyst coverage and recent insider buying might signal growing confidence, the market remains hesitant. This suggests that momentum is still building slowly here.

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With shares trading below both analyst targets and intrinsic value estimates, the stage seems set for a re-rating. However, is Simmons First National genuinely undervalued or has the market already accounted for all future growth?

Most Popular Narrative: 23.5% Undervalued

With Simmons First National trading at $17.45 and the most widely followed narrative setting fair value at $22.80, there is a notable gap between current price and future expectations. This sets the stage for a closer look at what underpins such optimism.

The company is actively attracting and retaining top talent while capitalizing on industry dislocation and M&A activity in key markets, improving its competitive positioning and supporting future business expansion and earnings growth. Continued remixing of the loan portfolio toward higher-yielding variable-rate loans and the repricing of legacy fixed-rate loans at higher rates present a tailwind for net interest margin expansion, enhancing core profitability.

Read the complete narrative.

Want to know what’s fueling this bullish outlook? The playbook behind the valuation mixes ambitions of margin expansion, talent wars, and bets on digital initiatives. But what are the wild card financial projections driving a price target this high? Peek beneath the hood to see the boldest forecasts analysts have made in recent quarters.

Result: Fair Value of $22.80 (UNDERVALUED)

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

However, persistent competitive loan pricing and rising expenses could easily derail this optimistic outlook. This could potentially hinder both margin gains and revenue momentum.

Find out about the key risks to this Simmons First National narrative.

Build Your Own Simmons First National Narrative

If you see things differently or want to dig into the numbers your own way, you can craft your own view in just a few minutes, so why not Do it your way

A great starting point for your Simmons First National research is our analysis highlighting 3 key rewards and 3 important warning signs 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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