Raymond James Assumes UMB Financial (UMBF) at Outperform

Raymond James analyst David Feaster assumes coverage on UMB Financial (NASDAQ: UMBF) with a Outperform rating and a price target of $165.00.

The analyst comments "We resume coverage of UMB Financial (UMBF) with an Outperform rating and $165 price target. We believe its differentiated business model supports durable loan and earnings growth, underpinned by consistent market share gains that we expect to continue well into the future. Importantly, close coordination between its sales and credit functions enables UMBF to move quickly and win business without compromising its stringent credit discipline. Its diversified fee income businesses provide another key differentiator, benefiting from secular tailwinds and adding durability to earnings growth. The recent Heartland Financial acquisition has structurally improved the cost base through synergies and scale, driving material positive operating leverage, with further upside potential as revenue synergies materialize. We project UMBF sustaining a midto high-teens ROATCE and +1.4% ROAA, supporting high-teens annualized TBV growth. Also, its conservative credit profile, strong capital generation, and meaningful fee income contribution should provide downside protection should the economic backdrop weaken. All in, we believe UMBF’s combination of above-peer profitability and organic growth, diversified revenue streams, and strong balance sheet creates a durable earnings and TBV compounding story not adequately reflected in its roughly in-line P/E valuation vs. peers, leaving risk/reward favorable."

For an analyst ratings summary and ratings history on UMB Financial click here. For more ratings news on UMB Financial click here.

Shares of UMB Financial closed at $143.34 yesterday.

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