There’s nothing like an analyst upgrade to light a fire under a stock. And that’s just what happened to Columbia Banking System (NASDAQ:COLB), which got an upgraded analyst opinion and saw its stock rise nearly 6% at the close of Thursday’s trading.
The upgrade came from KBW’s own Christopher McGratty, who pointed out that Columbia Banking System has one serious point in its favor: the fourth-highest tangible book value per share (TBV/share) figure in the entire KBW Nasdaq Regional Banking Index. Columbia’s TBV figure comes out to be 45%, which may not sound that great until you consider the second-highest score. That score belongs to New York Community Bancorp (NYSE:NYCB), which comes in at 53%.
That wasn’t all that gave McGratty pause. Columbia’s flexibility in its balance sheet gave it extra life. Both it and New York Community can “…proactively manage the balance sheet with little (to) no impact on capital (or) earnings.” However, KBW also expects that bank stocks, in general, will have troubles depending on overall liquidity, capital, and balance sheet performance. This might give Columbia further impetus to go up since it has that previously-mentioned flexibility in its balance sheet.
Columbia has a bit of a split decision among analysts. With four Buy recommendations and four Holds, analyst consensus rates Columbia stock a Moderate Buy. Further, Columbia stock comes with 37.22% upside potential thanks to its $29.86 average price target.
