On Thursday, Barclays began coverage on shares of First Citizens BancShares (NASDAQ:FCNCA) with an Equalweight rating and set a price target of $1,850. The initiation comes as the firm recognizes the bank's strong focus on book value growth, the advantages gained from recent acquisitions, and the potential for inclusion in the S&P 500.
The firm acknowledged the positive aspects of First Citizens BancShares, including its strategic emphasis on growing its book value and the benefits it has reaped from its recent acquisitions. These factors contribute to the bank's robust position in the market.
However, Barclays also pointed out areas of caution. The firm is closely monitoring certain loan books within the bank's portfolio and anticipates potential net interest income (NII) headwinds. Additionally, the analyst noted that First Citizens BancShares will require new regulatory capabilities to navigate the evolving financial landscape.
Moreover, Barclays highlighted structural considerations of the bank's stock, including its dual class stock structure, the family management, and the noted low liquidity of its shares. These elements are seen as significant factors to consider when evaluating the company's stock performance and investor relations.
The price target of $1,850 set by Barclays reflects the firm's assessment of the bank's current financial health and market position, balanced by the potential challenges and structural considerations mentioned.
InvestingPro Insights
As First Citizens BancShares (NASDAQ:FCNCA) captures the attention of Barclays with its recent coverage initiation, key metrics and insights from InvestingPro provide a deeper look into the company's financial landscape. With a market capitalization of $23.15 billion and an attractive P/E ratio of 6.11 based on the last twelve months as of Q4 2023, FCNCA shows signs of being undervalued. This is further supported by its substantial revenue growth of 90.15% over the same period, indicating a strong upward trajectory.
InvestingPro Tips highlight that FCNCA has demonstrated a commitment to shareholder returns, consistently raising its dividend for 7 consecutive years and maintaining dividend payments for 39 years. Additionally, the company's stock is trading near its 52-week high with a price that is 98.82% of this peak, reflecting investor confidence. Analysts have also revised their earnings upwards for the upcoming period, suggesting optimism about the bank's future performance.
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