SouthState Corporation (SSB) has received a new Hold rating, initiated by Stephens analyst, Russell Gunther.
Geoff Meacham has given his Hold rating due to a combination of factors surrounding SouthState Corporation’s current financial position and future prospects. The bank’s substantial asset size and significant presence in the southeastern United States, particularly in Florida, positions it well for organic growth and potential mergers and acquisitions. However, Meacham points out that while SouthState is expected to see mid-single-digit loan growth in the coming years, its underwriting standards could limit growth potential in the context of an inverted yield curve. Moreover, the assessment includes the anticipation of a trough in net interest margin (NIM) that is less severe and arrives sooner than expected, supported by a favorable loan repricing profile and a deposit mix that should provide stability going forward.
Furthermore, Meacham notes that SouthState’s capital levels are expected to continue to accrete, which should buffer the bank against potential downturns and position it for opportunistic activities without the need for share buybacks. SouthState’s total capital ratio is on par with peers, with a common equity tier 1 (CET-1) ratio slightly higher. The bank’s loan loss reserves are also more conservative compared to peers, indicating a lower risk asset quality model. Despite these strengths and a return profile that exceeds peers, the rating is tempered by a valuation that exceeds the target based on the analyst’s return on tangible common equity (ROTCE) projections and a slight negative delta to the price target. Thus, the Hold rating reflects a balanced view of the potential upside against the risks and valuation concerns.
Gunther covers the Financial sector, focusing on stocks such as Synovus, WesBanco, and SouthState Corporation. According to TipRanks, Gunther has an average return of 8.9% and a 60.53% success rate on recommended stocks.
In another report released on December 15, Truist Financial also maintained a Hold rating on the stock with a $93.00 price target.
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SouthState Corporation (SSB) Company Description:
South State Corp. is a bank holding company. It provides banking services and products to customers through its subsidiary. The company was founded on February 22, 1985 and is headquartered in Columbia, SC.
Read More on SSB:
- South State price target raised by $21 at Truist, here’s why
- South State price target raised to $93 from $72 at Truist
- South State participates in a conference call with DA Davidson
- South State announces transfer of listing of common stock to NYSE
- SouthState Corporation Reports Third Quarter 2023 Results, Declares Quarterly Cash Dividend
