WFC - Pinnacle Financial Partners: Exceptional Growth Can Still Drive Upside

2024-07-18 11:14:27 ET

Summary

• Pinnacle Financial Partners had a somewhat noisy Q2, but core results were better than expected, with revenue, net interest income, and fee income beating expectations, driving a $0.04/share pre-provision beat.
• Pinnacle's growth model, focused on customer service and hiring talented and experienced loan officers from rivals, provides a long runway for growth, with opportunities in multiple markets.
• Expansion into Washington, DC has already been a greater success than Atlanta, and Jacksonville is next up.
• I can't say that Pinnacle shares are significantly undervalued, but this is one of the cleanest growth stories in banking right now.

One of the most challenging dilemmas for an investor is what to do with the stock of a great company that’s no longer trading at an obviously compelling price. Sell too soon and miss you out on the all-time winners, but there is likewise risk in holding out for top dollar or not recognizing a change in the underlying story....

For further details see: