What Happened?
Shares of regional banking company Cadence Bank (NYSE: CADE) jumped 3.6% in the afternoon session after Piper Sandler analysts upgraded the stock to "Overweight" from "Neutral."
The investment firm also significantly raised its price target on the shares to $42 from $36. Piper Sandler's positive outlook follows Cadence's recent completion of its acquisition of Industry Bancshares. The analyst noted that the benefits from increased scale and cost savings from the deal should drive the stock higher, seeing a potential total return of over 25% in the next year. Adding to the bullish sentiment, Barclays analyst Jared Shaw also reiterated an "Overweight" rating and lifted his price target to $41 from $38. Piper Sandler believes the earnings boost from the acquisition carries low execution risk and has increased its earnings per share estimates for 2025 and 2026.
After the initial pop the shares cooled down to $35.25, up 3% from previous close.
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What Is The Market Telling Us
Cadence Bank’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
Cadence Bank is up 4.6% since the beginning of the year, but at $35.25 per share, it is still trading 10.3% below its 52-week high of $39.29 from November 2024. Investors who bought $1,000 worth of Cadence Bank’s shares 5 years ago would now be looking at an investment worth $1,695.
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