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D.A. Davidson Downgrades People's Utah Bancorp To Neutral Following 'Home Run' IPO

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D.A. Davidson Downgrades People's Utah Bancorp To Neutral Following 'Home Run' IPO

D.A. Davidson has downgraded Peoples Utah Bancorp (NASDAQ: PUB) to Neutral on valuation and limited upside to its new target price of $22.

Since its earnings report on July 27, People's Utah shares have risen about 17 percent and hit a new all-time high of $21.28 on Thursday. Over the same period, the S&P 500 was up less than 1 percent and the NASDAQ Bank Index grew 5.6 percent.

"We believe the recent outperformance has been justified given the company's solid loan growth and margin expansion," analyst Jeff Rulis wrote in a note.

Successful IPO

Since the bank's IPO last year (mid-June 2015) at $14.50, shares have seen about a 45 percent ascent due to double-digit loan growth, margin expansion, pristine credit quality, better-than-peer operating efficiency and profitability metrics.

Related Link: People's Utah Bancorp Reports Q2 EPS $0.31 vs $0.29 Est NII $17.2M

"Capital deployment concerns have quieted down as the bank's outperformance suggests goals can be met organically, while M&A options are simply additive to an already successful story," Rulis noted.

The analyst stuck to his 2016 and 2017 EPS estimates of $1.24 and $1.29, respectively, as he still looks upon the company's outlook "favorably," citing "the bank operating, and taking share, in a strong Utah economy."

Rulis raised its price target to $22 from $21. The analyst's new target represents 17.1x his 2017 EPS estimate and 1.8x current TBV.

Shares of PUB closed Thursday's regular trading session at $21.

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Latest Ratings for PUB

DateFirmActionFromTo
Aug 2018DowngradesOutperformMarket Perform
Sep 2016DowngradesBuyNeutral
Jun 2015Initiates Coverage onBuy

View More Analyst Ratings for PUB
View the Latest Analyst Ratings

Posted-In: D.A. Davidson Jeff RulisAnalyst Color Downgrades Price Target Analyst Ratings

 

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