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Ameris Bancorp's M&A Opportunities Are 'Plentiful,' Piper Jaffray Says

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  • Ameris Bancorp (NASDAQ: ABCB) shares have climbed 33 percent year-to-date, rising almost steadily through 2015.
  • Piper Jaffray’s Peyton N. Green maintained an Overweight rating for the company, while raising the price target from $33 to $37.
  • Since the industry faces challenges, there may be several M&A opportunities, Green stated.

A meeting with CFO Zember provided “encouraging signs” of Ameris Bancorp’s 2017 performance being boosted by additional organic growth, operating leverage due to efficiency efforts, and M&A, analyst Peyton Green said. He believes the company represents “a solid investment opportunity” given the outlook for already robust returns of ROA of 1.2 percent and ROTCE of 17 percent, and “potentially stronger EPS growth.”

The CFO reiterated that the acquisition of Jacksonville Bancorp Inc. (NASDAQ: JAXB) is expected to be accretive to EPS by $0.05-$0.07.

“ABCB will be the #7 bank with 1.7% share in the attractive Jacksonville MSA, which will be ABCB's largest market (19% of deposits). The ROA goal of 1.05%-1.20% remains focused on a core bank ROA of 0.90%-1.00% and SBA-Mortgage ROA of 0.15%-0.20%,” Green wrote.

CFO Zember expressed optimism regarding accretive deals being executed without having to burn TBVPS. In view of the challenges being faced by the industry, M&A opportunities “should remain plentiful” among banks with less than $1B of assets in SC, GA, and FL, the analyst mentioned.

Latest Ratings for ABCB

DateFirmActionFromTo
Dec 2020Raymond JamesMaintainsStrong Buy
Oct 2020Piper SandlerMaintainsOverweight
Oct 2020Raymond JamesMaintainsStrong Buy

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Posted-In: Peyton N. Green Piper JaffrayAnalyst Color Long Ideas Price Target Reiteration Analyst Ratings Trading Ideas

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