TCBX - Third Coast Bancshares upgraded Origin Bancorp downgraded at RayJay
2023-07-28 15:19:21 ET
Third Coast Bancshares ( NASDAQ: TCBX ) stock climbed 4.6% in Friday mid-afternoon trading as Raymond James upgraded the stock to Outperform from Market Perform as the regional lender's second-quarter results, reported on Wednesday, reflected solid growth in net interest income along with loans and deposits.
The Texas-based company's ongoing loan and deposit growth "is expected to offset NIM pressure to drive ongoing growth in net interest income," analyst Michael Rose wrote in a note.
"Coupled with expectations to hold noninterest expenses relatively flat in the nearer-term, expectations for credit trends to remain relatively benign, and ongoing fee income momentum, we project the company will be in the minority of banks that could generate positive operating leverage in 2024 (albeit modest)," he added.
Rose views the stock's risk-reward "positively," as it trades below tangible book value and at a price-to-earnings discount to peers. TCBX has a Momentum Grade of "A-," with its three-month price performance outpacing the sector median by a factor of roughly 4x.
In a separate note, Rose downgraded Origin Bancorp ( NYSE: OBK ) to Market Perform from Outperform, as ongoing net interest margin compression "points to a more challenged profitability profile than we have previously projected." On Wednesday, the lender posted adjusted earnings that topped the average analyst estimate , but turned in revenue that fell short of expectations.
OBX dipped 1.4% at the time of writing.
Also on Friday, Rose upgraded Business First Bancshares ( BFST ) to Outperform, citing impressive Q2 results given a solid climb in deposits as well as stability in net interest margin.
An SA stock screener, meantime, gave The Bancorp ( TBBK ) the highest Quant rating of any other publicly-traded regional bank stock.
More on regional banks:
- NYCB raised to Overweight at J.P. Morgan as Q2 results reveal growth potential
- Bond king Bill Gross says he will sell most regional bank holdings
- Central Pacific Financial: Dividend Is Attractive But Earnings Outlook Is Worrisome
- Business First Bancshares: Hidden Small-Cap Story, Ready To Reverse
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Third Coast Bancshares upgraded, Origin Bancorp downgraded at RayJay