What took place
Truist Financial ( TFC - 6.00 %) shares fell by 5.9 % on Friday. The stock closed the conference at$ 31.49, a nearly 27 % decline from the previous session. The S & ampP 500, Dow Jones Industrial Average, and Nasdaq Composite all increased by about 0.1 %, indicating a slight increase in the market for the day.
What then?
First-quarter earnings were released on Wednesday by Truist Financial, the seventh-largest bank in the United States by assets, and they fell short of analysts' compromise expectations. As a result, several analysts on Truist Friday lowered their price targets, which contributed to the company's's share price falling.
In Q1, net income increased 6 % year over year to$ 1.4 billion, while revenue increased by a factor of 15 % to$ 6.2 billion. Additionally, average loans and leases increased by 2 % year over year to$ 326 billion, increasing net interest income by 22 %. Additionally, Truist experienced expansion in its commercial and industrial product profile.
The average cost of deposits increased by 46 basis points to 1.12 %, while average deposits decreased by 1.2 % to$ 408 billion. Up from 10.5 % in the previous quarter, its Common Equity Tier 1 capital ratio was 10.6 %.
Although those numbers were fairly reliable, a number of analysts — including those from Morgan Stanley, Piper Sandler, RBC Capital, and Credit Suisse — lowered their Truist price targets in response to anticipated economic headwinds.
Nevertheless, they all maintained stable banks ratings, with Morgan Stanley and Credit Suisse maintaining balanced or equal-weight ratings while Piper Sandler and RBC maintained their surpass ratings.
Just what?
All of the analysts have lowered their price targets, but they still anticipate a rise in Truist store this summer. Credit Suisse set the lowest price target at$ 40 per share, which is 26 % higher than Truist's's current price of$ 31.49.
Piper Sandler and RBC both predicted that the highest goal would be$ 46 per share. That would translate to a gain of 46 % over the following 12 months.
Truist is currently trading below its book worth, with a price-to-book ratio of 0.8 and an income amount that is roughly 7.5. It is also incredibly inexpensive. While macroeconomic headwinds are a priority, Truist appears to be an excellent long-term investment at this valuation. Big banks may benefit from the March banking crisis.
