Analyst Mihir Bhatia of Bank of America Securities maintained a Buy rating on SLM, with a price target of $37.00.
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Mihir Bhatia has given his Buy rating due to a combination of factors including SLM’s strong market position, which is expected to support significant balance sheet growth and substantial loan sale volumes yielding attractive returns. Despite a miss in the third-quarter earnings per share (EPS) due to lower net interest income and higher provisions, the company has raised its EPS guidance, driven by an upcoming loan sale that is anticipated to release reserves and positively impact earnings.
Additionally, SLM is exploring new funding partnerships that could lead to sustainable growth in capital-light, fee-based revenues. The company’s proactive share repurchase strategy, which exceeded expectations, and disciplined operating expenses further bolster the Buy rating. While there are concerns about rising delinquency rates, the company attributes part of this increase to changes in loan modification eligibility criteria and remains confident in its overall financial health.
In another report released today, Barclays also maintained a Buy rating on the stock with a $35.00 price target.
Based on the recent corporate insider activity of 63 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of SLM in relation to earlier this year.