Key insights
- Piper Sandler lowered its price target on Fifth Third Bancorp (FITB) to $54 from $57, citing delayed share repurchases due to merger-related charges and focus on capital levels. EPS estimates for 2026 and 2027 were slightly reduced. While analysts have revised earnings downwards, the company maintains a high shareholder yield and has consistently raised its dividend. The firm continues to view the stock favorably due to cost savings and profitability improvements from the CMA transaction.
Investing.com - Piper Sandler lowered its price target on Fifth Third Bancorp stock (NASDAQ:FITB) to $54 from $57 while maintaining an Overweight rating. The stock currently trades at $44.71, suggesting potential upside to the new target. According to InvestingPro analysis, FITB appears undervalued at current levels, with the stock trading at a P/E ratio of 12.66.
The firm adjusted its earnings per share estimates to reflect a delayed expectation for when Fifth Third Bancorp will resume share repurchases following its CMA transaction. Piper Sandler previously assumed the bank would recommence buybacks in the third quarter of 2026 but now expects repurchases to begin in the fourth quarter of 2026 at modest levels.
The firm cited the likelihood of merger-related charges over the next few quarters and the bank’s focus on capital levels as reasons for the revised timeline. Piper Sandler’s 2026 EPS estimate was lowered to $3.97 from $3.98, while its first quarter 2026 estimate remains at $0.82. The firm’s 2027 EPS estimate was reduced to $4.74 from $4.77. An InvestingPro tip notes that 4 analysts have revised their earnings downwards for the upcoming period, though the company maintains a high shareholder yield and has raised its dividend for 15 consecutive years. For deeper insights, investors can access FITB’s comprehensive Pro Research Report, one of 1,400+ available on InvestingPro.
The price target reduction reflects lower bank equity valuations, now approximately 13 times the firm’s 2026 EPS estimate compared with 14 times previously. Piper Sandler noted the valuation adjustment in its analysis.
The firm said it continues to view the stock favorably, pointing to cost savings and profitability improvements from the CMA transaction and revenue opportunities as Fifth Third Bancorp leverages its franchise.
In other recent news, Fifth Third Bancorp declared a cash dividend of $0.40 per common share for the first quarter of 2026, payable on April 15 to shareholders of record as of March 31. The bank also announced dividends on multiple series of preferred stock, including the Series H 5.10% Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock. Fifth Third Bancorp has completed its acquisition of Comerica Inc., making Comerica a wholly owned subsidiary. This merger resulted in the conversion of Comerica common stock into Fifth Third common stock and preferred stockholders receiving new Fifth Third preferred shares. Following the acquisition, S&P Global Ratings upgraded Comerica Inc.’s long-term rating to ’BBB+’ and Comerica Bank’s to ’A-’, removing them from CreditWatch. Additionally, Piper Sandler reiterated its Overweight rating on Fifth Third Bancorp, maintaining a price target of $57.00. Meanwhile, noteholders of Tricolor Holdings have filed a lawsuit against Fifth Third Bancorp, JPMorgan Chase, and Barclays, alleging their involvement in perpetuating fraud at the bankrupt used-car dealer.
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