First Horizon (FHN): Fresh Analyst Confidence Sparks Valuation Reassessment After Barclays’ Upgraded Price Target

First Horizon (FHN) caught some attention after Barclays reaffirmed its positive view, standing out by maintaining its rating and projecting further upside. This signals a shift in analyst sentiment compared to recent cautious takes.

See our latest analysis for First Horizon.

First Horizon’s share price has moved steadily this year, with the stock up 8.45% year-to-date and a 12.4% total shareholder return for the past year. While the latest analyst confidence is making waves, recent executive changes and board expansions in October and November suggest the company is focused on strengthening leadership and strategy for further growth. Momentum appears to be building, especially as performance in recent years has been resilient, with a remarkable 108% total shareholder return over five years.

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With First Horizon trading below both its analyst price target and estimated intrinsic value, investors may be wondering if there is still room for the stock to run or if the future is already reflected in its price.

Most Popular Narrative: 11.4% Undervalued

First Horizon's most widely followed valuation narrative sets its fair value at $24.49, notably higher than the last close of $21.69. This suggests analysts see further upside, with critical assumptions driving this view.

The company's diversified business model and focus on cost discipline may boost earnings stability and shield against economic fluctuations. Economic uncertainty and credit risks may hurt First Horizon’s revenue, net interest margins, and earnings as market volatility and potential recession loom.

Read the complete narrative.

Think a high but justified price target is just about market momentum? Think again. The narrative is built on bold assumptions around margin resilience and top-line growth, plus a confidence that volatility can be weathered. Want to see which numbers drive the analysts’ conviction? Unlock the full narrative to see what’s shaping this valuation.

Result: Fair Value of $24.49 (UNDERVALUED)

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

However, near-term economic headwinds or rising credit costs could still undermine the bullish case for First Horizon. This serves as a reminder for investors to tread carefully.

Find out about the key risks to this First Horizon narrative.

Another View: Through the Lens of Market Multiples

Take a look at how First Horizon stacks up on a price-to-earnings basis. At 12.5x, it trades above the average for both the US Banks industry (11.1x) and its peer group (10.3x). It is also above its own fair ratio of 11.7x. This premium could signal confidence, but it also raises the bar for future growth and means investors risk paying up for less upside.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own First Horizon Narrative

If you’re the type who wants to dig into the numbers and build your own perspective, you can have a fresh narrative up in minutes. Do it your way.

A great starting point for your First Horizon research is our analysis highlighting 3 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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