On Tuesday, RBC Capital Markets adjusted its stance on First Horizon (NYSE:FHN) National Corporation (NYSE:FHN) stock, upping the bank from Sector Perform to Outperform. The firm also increased the price target to $18.00, up from the previous $16.00. The upgrade comes in light of growing confidence in the bank's long-term strategy and a positive financial outlook.
The analyst at RBC Capital noted that the decision to upgrade First Horizon National was driven by several factors. These include a solid growth in the bank's balance sheet, a positive revenue trajectory, reasonable expense trends, and a manageable credit outlook. These elements point to a favorable near-to-medium-term outlook for the company.
First Horizon's recent announcement of a large buyback authorization has also contributed to the optimistic view. The potential for a more aggressive capital return this year is seen as a positive move that could enhance shareholder value.
The upgraded rating and higher price target reflect a belief in the bank's ability to execute its strategy successfully and deliver on its financial goals. First Horizon National's stock adjustment by RBC Capital underscores the bank's promising trajectory and potential for growth this year.
InvestingPro Insights
As investors weigh RBC Capital Markets' optimistic outlook on First Horizon National Corporation (NYSE:FHN), real-time data and insights from InvestingPro provide additional context for evaluating the bank's stock. According to the latest metrics, First Horizon is currently trading with a P/E ratio of 9.58, which suggests that the stock is trading at a valuation that may be appealing to value-oriented investors. The company has also shown a commitment to rewarding its shareholders, maintaining dividend payments for 14 consecutive years, with a current dividend yield of 3.96%. This track record of consistent dividend payments underscores the bank's financial stability and could be a reassuring factor for income-focused investors.
InvestingPro Tips highlight that analysts have recently revised their earnings expectations downwards for the upcoming period and that the company is trading at a high P/E ratio relative to near-term earnings growth. This could signal caution for those looking at short-term performance. However, with analysts predicting profitability for the year and a significant price increase of 49.19% over the last six months, there is a positive sentiment that could be factoring into RBC Capital's upgrade.
For investors seeking a deeper dive into First Horizon's financials and future outlook, there are additional InvestingPro Tips available at InvestingPro. Use coupon code PRONEWS24 to get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, and discover why despite some concerns, the bank's long-term strategy and shareholder value proposition may still present an attractive opportunity.
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