PB - Prosperity Bancshares: Flattish Earnings Outlook

• After the prolonged declining trend, the loan portfolio will likely turn around by early next year after the forgiveness of Paycheck Protection Program loans is over.
• As the loan portfolio is mostly made up of variable and floating-rate loans, PB is well-positioned to benefit from an interest rate hike.
• The provisioning expense will likely trend higher towards a more normal level next year.
• Next year’s target price suggests a small upside from the current market price. Further, PB is offering a modest dividend yield.

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