On Monday, Piper Sandler, a financial services firm, raised its price target for Mid Penn Bancorp (NASDAQ:MPB) shares to $35.00, up from the previous target of $31.00. The firm has retained its Overweight rating on the bank's stock.
Mid Penn Bancorp reported earnings per share (EPS) of $0.74 for the third quarter of 2024. Excluding merger-related expenses, the core EPS was calculated at $0.75. This performance was stronger than both the analyst's and the consensus estimates.
The positive difference in expectations was attributed to higher-than-anticipated net interest income, which exceeded projections by $0.04, and fee income, which was $0.02 above estimates. Additionally, the company's provisioning was $0.03 less than expected. These gains were partially offset by an increase in the expense base by $0.08.
After making adjustments for certain discrete expenses, Mid Penn Bancorp's pre-provision net revenue (PPNR) is considered slightly better than initially modeled by the analyst. While non-performing assets (NPAs) saw a slight uptick due to the migration of a single loan, the increase was from a very low base, indicating that the overall credit quality remains benign.
The bank did not engage in share repurchases during the quarter, though it ended the period with slightly higher capital levels. Despite having $5 million remaining under the current buyback authorization, Piper Sandler does not anticipate repurchase activity in its forecasts for the bank.
In other recent news, Mid Penn Bancorp reported a second quarter earnings per share (EPS) of $0.71, surpassing both the analyst's estimate of $0.62 and the consensus estimate of $0.64. The company's net interest income (NII) exceeded expectations, contributing $0.11 to the EPS, while operating expenses were $0.02 below what was anticipated. A significant increase was observed in the net interest margin (NIM) to 3.12% last quarter, 15 basis points higher than the previous quarter.
Mid Penn Bancorp also saw an improvement in capital levels, with both the Tangible Common Equity (TCE) and the Common Equity Tier 1 (CET1) ratios rising. The credit profile remained strong, with nonperforming assets (NPAs) decreasing from the last quarter.
The company has reauthorized a share buyback program of up to $15 million to be executed within the next year, with $5 million remaining under the program. Piper Sandler, a financial firm, has maintained an Overweight rating and increased the price target from $25 to $31 on Mid Penn Bancorp's shares, reflecting a positive outlook on the bank's financial health and future performance.
InvestingPro Insights
Recent data from InvestingPro adds depth to Piper Sandler's positive outlook on Mid Penn Bancorp (NASDAQ:MPB). The company's market capitalization stands at $516.72 million, with a P/E ratio of 10.55, suggesting a potentially undervalued stock relative to its earnings. This aligns with an InvestingPro Tip indicating that MPB is trading at a low P/E ratio relative to its near-term earnings growth, which could support Piper Sandler's decision to raise the price target.
The bank's financial health appears robust, with a revenue of $172.75 million for the last twelve months as of Q3 2024, representing a 4.11% growth. Moreover, MPB boasts an impressive operating income margin of 36.97% for the same period, reflecting efficient operations that contribute to its strong earnings performance.
InvestingPro Tips also highlight that MPB has maintained dividend payments for 14 consecutive years, which may appeal to income-focused investors. Additionally, the stock has seen a significant price uptick over the last six months, with a total return of 51.6%, indicating strong market confidence in line with Piper Sandler's optimistic view.
For investors seeking more comprehensive analysis, InvestingPro offers 8 additional tips for Mid Penn Bancorp, providing a deeper understanding of the company's financial position and market performance.
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