EQB Inc (EQB: CN) (OTC: EQGPF) received an updated price target from BMO Capital Markets. The firm raised its price target on the stock to Cdn$106.00 from the previous Cdn$104.00, while maintaining an Outperform rating. The adjustment reflects the analyst's expectation of the company's potential despite near-term challenges.
The analyst from BMO Capital Markets noted that while higher provisions for credit losses could be a point of focus for another quarter, the outlook for fiscal 2025 appears more positive.
The optimism is based on EQB's progress in resolving loans in equipment finance and commercial mortgage lending, as well as the anticipation of a normalizing monetary policy.
BMO Capital's continued Outperform rating indicates confidence in EQB's performance.
The analyst highlights the stock's valuation at 1.2 times book value, which is deemed attractive for a bank with a consistent return on equity (ROE) above 15% through various economic cycles.
EQB, which operates in the financial sector, is navigating through an environment where credit losses are a significant consideration for investors and analysts alike. The company's efforts in loan resolutions and the expected easing of monetary policy are key factors contributing to the positive outlook for the coming years.
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