CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We decrease our 12-month target price by $1 to $30, 8.6x our 2024 EPS estimate, below TFC’s five-year forward P/E average of 11.0x, given weaker credit quality expectations. We raise our 2023 EPS estimate by $0.05 to $3.76 and increase 2024’s by $0.03 to $3.50. TFC posted adjusted Q3 EPS of $0.84 vs. $1.24 a year ago, $0.01 above consensus. Net interest income (-2% Q/Q) degradation slowed in the quarter as the bank saw 4 bps of improvement in its net interest margin. However, balance sheet optimization led to a 3% decline in loan balances as results reflect the sale of the bank’s student loan portfolio and a 6% drop in indirect auto. As a result, TFC saw a boost to its capital ratios (CET1 ratio +30 bps to 9.9%). After four straight quarters of deposit outflows, momentum reversed with modest 0.3% growth. Investment banking and trading income (-12%) continued to struggle, while wealth management rose 4%. Management did not give a meaningful update on the potential sale of its insurance business.