First BanCorp posts flat Q3 profit, net interest income dips

Overview

• Puerto Rico bank holding company reported Q3 net income flat sequentially, EPS unchanged at $0.63

• Q3 net interest income declined slightly due to lower purchase discount income and higher deposit costs

• Company announced $350 mln stock buyback and 25% dividend increase

Outlook

• Company says it remains focused on capital allocation to support organic growth and franchise opportunities

• First BanCorp says it will continue to prioritize excess capital deployment while preserving flexibility

Result Drivers

• NET INTEREST INCOME DRIVERS - Lower purchase discount income and higher deposit costs weighed on net interest income, partly offset by growth in commercial and construction loans and reinvestment in higher-yielding assets

• NON-INTEREST INCOME - Decline mainly due to lower gains on purchased income tax credits and absence of prior quarter's asset sale gain

• NON-INTEREST EXPENSES - Increase driven by higher contingency reserve related to a commercial property legal ruling and higher card processing and compensation costs

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for First BanCorp is $31.50, about 15.2% above its October 21 closing price of $27.34

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 11 three months ago

Reuters Recommended Reads

• Oct 21 - First Bancorp Q3 net income rises 17.5%

• Oct 21 - OFG Bancorp's Q3 EPS rises on commercial loan growth

• Oct 19 - Zions Bancorp Q3 EPS rises 20% on improved credit quality

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)