DA Davidson Raises Price Target on East West Bancorp (EWBC), Loan Outlook Remains Strong

DA Davidson is maintaining its Buy rating on shares of East West Bancorp (NASDAQ: EWBC) while raising its price target from $21 to $24.

The firm notes that EXBC's loan growth outlook is promising as it looks to continue to grow on C&I and Trade Finance growth. DA Davidson reports that the company's core NII was roughly flat for the quarter due to legacy loan growth of $407 million compared to $234 million of run-off in the FDIC-portfolio.

An analyst at DA Davidson comments, "We continue to anticipate an increase in EWBC’s dividend payment in 2012 given strong profitability and solid capital position. Management has targeted a return to its $0.40 annual dividend payment prior to launching a buyback, likely raising the quarterly dividend to $0.10 in early 2012. With aspirations of additional acquisition-driven growth we expect EWBC’s total payout ratio (dividends + buyback) to remain modest."

For FY11, the firm forecasts earnings of $1.57 per share on $888 million in sales. For FY12, DA Davidson estimates earnings of $1.78 per share on $882 million in sales.

For an analyst ratings summary and ratings history on East West Bancorp click here. For more ratings news on East West Bancorp click here.

Shares of East West Bancorp closed at $19.47 yesterday.

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