First Republic Bank (NYSE:FRC) continues to be the talk of Wall Street. The downtrodden regional bank is hanging on by a thread in the midst of a systemic liquidity threat that may well tangle the entire U.S. banking system. In the wake of the banking crisis, however, FRC stock price predictions are gaining steam as interested investors consider the potential of a regional bank at the bottom of its valuation.
What do you need to know about FRC stock?
Well, First Republic recently experienced a surge of bank runs not unlike Silicon Valley Bank. Unlike SVB, however, FRC’s deposits are largely uninsured, meaning it’s not currently facing a liquidity crisis in the same way SVB has. Because of its uninsured nature, the bank was able to stay alive long enough to get some help from other banks amid rampant bank runs. Indeed, recent banking data shows smaller U.S. banks lost about $108 billion worth of deposits in just the past week or so.
While there remain concerns that First Republic will be forced to go under public ownership — likely at the hands of the Federal Deposit Insurance Corporation (FDIC) — that threat has largely subsided in the eyes of some analysts.
Now sitting at around $13.50 per share, exactly what kind of upside does FRC stock have?
FRC Stock Price Predictions
According to CNN Business’s 18 polled analysts, FRC stock is a “hold.” Of the 18 analysts, five rate the stock a “buy” while 12 analysts give it a “hold” rating. Lastly, just one analyst gives shares a “sell” rating.
With that said, despite the relatively bearish ratings, FRC still has an astoundingly optimistic consensus price target on CNN Business. Indeed, FRC’s median 12-month price forecast is $130 per share, representing more than 800% upside.
Meanwhile, Wolfe Research analyst Bill Carcache believes FRC stock is still very much touch-and-go. Carache remains wary of the possibility that the bank may need to file for bankruptcy or go under public ownership:
“FRC’s ability to continue to operate as a stand-alone business will be challenged by the material increase in its funding costs following recent deposit outflows.”
Carache reiterated a “peerperform” rating on FRC stock, with a price target range between $0 and $26, reflecting the chance that the company files for Chapter 11. Similarly, Morningstar recently lowered its fair value estimate on First Republic shares, from $34 to $3. Finally, Wedbush analyst David J. Chiaverini downgraded FRC stock to “neutral” from “outperform” earlier this month.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
