DA Davidson Upgrades Flagstar Bank (FLG) to Buy

DA Davidson analyst Peter Winter upgraded Flagstar Bank (NYSE: FLG) from Neutral to Buy with a price target of $14.50 (from $12.00).

The analyst comments "Typically when a bank trades below TBV there are two major concerns, capital and credit. Mgmt addressed the capital issues, selling parts of the mtg business and the CET1 ratio increased 281 bp Y/Y to 11.9% vs. our peer median of 10.8%. The reason we are upgrading from Neutral to BUY and increasing our PT to $14.50 (was $12) is FLG is trading at just 0.64X TBV and we are more confident mgmt has gotten their arms around the credit issues, following $892M in NCOs in 2024 and built the ACL ratio to 1.78% vs. 1.23% in 4Q23. Mgmt has reviewed 100% of the CRE portfolio, and expects NPLs to decline 30% by YE and substandard loans to decline 10%."

For an analyst ratings summary and ratings history on Flagstar Bank click here. For more ratings news on Flagstar Bank click here.

Shares of Flagstar Bank closed at $11.06 yesterday.

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