Citi downgraded UMB Financial (UMBF) to Neutral from Buy with a price target of $127, down from $130. The firm says that while UMB reported a strong operational quarter to close out 2024, it has “limited near-term optimism” on the proforma franchise, driven by the waning operational trends at Heartland Financial. The balance sheet addition of Heartland is dilutive to UMB’s net growth profile, and introduces both operational and near-term credit risks, the analyst tells investors in a research note. As such, Citi believes valuation expansion is less likely until trends prove themselves in the coming quarters.
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