Nicolet Bankshares stock target lifted, keeps buy on strong 3Q results
On Thursday, Nicolet Bankshares (NASDAQ:) (NYSE: NIC (NASDAQ:)) received an updated stock price target from Maxim Group following the release of its third-quarter financial results. The firm has increased its price target on the bank’s shares to $124.00, up from the previous target of $120.00, and has maintained its Buy rating on the stock.
The bank reported its third-quarter earnings on October 15, 2024, with a core earnings per share (EPS) of $1.98, excluding non-recurring gains of $0.12. This figure surpassed the consensus estimate of $1.86 and Maxim Group’s own estimate of $1.82.
The better-than-expected results were attributed to a wider net interest margin (NIM), which was up by 9 basis points, and a continuation of very strong credit quality, evidenced by negligible net charge-offs.
In light of the robust third-quarter performance, Maxim Group has also revised its 2025 GAAP EPS estimate for Nicolet Bankshares upward to $8.60, from the previous estimate of $8.50. The revised price target of $124 reflects this updated EPS forecast and is partly based on expectations of further rate cuts by the Federal Reserve.
The new price target suggests a valuation of 14.4 times the firm’s 2025 EPS estimate for Nicolet Bankshares, up from the prior multiple of 14.1 times. According to the firm, this premium is justified by Nicolet Bankshares’ track record of accretive acquisitions. The bank’s strong third-quarter performance and positive outlook appear to have reinforced confidence in its continued growth and profitability.
In other recent news, Nicolet Bankshares has made headlines with its strong performance in the second quarter of 2024, exceeding consensus estimates by approximately 9%. The company’s operational earnings per share (EPS) and pre-provision net revenue (PPNR) were particularly noteworthy.
This strong performance prompted financial services firm Stephens to raise its price target for Nicolet to $112, while maintaining an Equal Weight rating.
Nicolet Bankshares’ robust performance was also recognized by Maxim Group, which raised its price target to $120, maintaining a Buy rating. Piper Sandler, while maintaining a Neutral rating, also increased its price target for Nicolet Bankshares to $104, citing a strong quarter with a 1.3% return on assets and a 16.8% return on tangible common equity.
The company’s solid performance was attributed to an expanded net interest margin, a 2% increase in loan growth, and sustained strong credit quality. Additionally, Nicolet Bankshares demonstrated a significant recovery in deposit trends and a 14% year-over-year increase in Wealth Management fees.
As a result of these developments, the company increased its dividend by 12% to $0.28 per share. These are some of the recent developments at Nicolet Bankshares.
InvestingPro Insights
Recent data from InvestingPro adds further context to Maxim Group’s bullish stance on Nicolet Bankshares (NYSE: NIC). The company’s stock is currently trading at a P/E ratio of 12.58, which is relatively low compared to its near-term earnings growth potential. This aligns with one of the InvestingPro Tips, suggesting that NIC might be undervalued at its current price.
The company’s financial health appears robust, with a revenue of $342.79 million for the last twelve months as of Q3 2024, representing a strong growth of 28.93% over the same period. Additionally, Nicolet Bankshares boasts an impressive operating income margin of 46.8%, indicating efficient management and strong profitability.
InvestingPro Tips also highlight that NIC has seen a significant return over the last week, with a 1-week price total return of 11.78%. This recent momentum, coupled with the fact that the stock is trading near its 52-week high, suggests growing investor confidence in the company’s prospects.
For readers interested in a more comprehensive analysis, InvestingPro offers 6 additional tips for Nicolet Bankshares, providing a deeper insight into the company’s financial position and market performance.
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