BKU - BankUnited: Upside Even With Potential CRE Weakness

2024-06-24 22:58:52 ET

Summary

• BankUnited shares have risen over 26% in the past year but remain below pre-crisis levels, given increased funding costs.
• Recent commercial real estate worries have impacted regional banking sector performance, but BKU's loan portfolio is well positioned, even if there is a further downturn.
• BankUnited's deposit growth and conservative underwriting position it well for future earnings growth and potential upside for investors.

Shares of BankUnited ( BKU ) have been a solid performer over the past year, rising over 26%, though shares remain below levels seen when the regional banking crisis of Q1 2023 began. I last covered BKU in December , rating shares a “buy.” Since that recommendation, BKU has disappointed, trading essentially flat while the broader market has rallied by nearly 20%. Recently, commercial real estate worries have been an increasing concern for the regional banking sector. As such, it is a good time to determine if BKU risks further underperformance or if now represents a good buying opportunity....

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