Keefe, Bruyette & Woods has updated its valuation of Horizon Bancorp (NASDAQ:HBNC), increasing the target price from $19.00 to $21.00 while maintaining an Outperform recommendation. This adjustment follows the bank’s recent quarterly financial results that surpassed expectations.
For the quarter, Horizon Bancorp reported earnings of $0.53 per share, exceeding analyst consensus by $0.03. The bank attributed this performance to an upturn in pre-provision net revenue (PPNR) driven by elevated revenue streams and a reduction in its effective tax rate. Market data from InvestingPro indicates that six analysts have adjusted their earnings projections upward for Horizon Bancorp, anticipating full-year 2025 earnings per share (EPS) of $1.84.
A significant factor in the bank’s performance was its net interest margin (NIM), which surpassed forecasts by 9 basis points, contributing to higher revenues. Additionally, the bank saw enhanced fee income mainly thanks to robust activity in mortgage banking and wealth management segments. Nevertheless, InvestingPro Tips point out that despite these gains, the bank’s gross profit margins remain relatively weak, though the improved NIM may alleviate some pressure.
Loan portfolio expansion was notable with a 4% annualized growth rate during the quarter, mostly propelled by a 9% annualized increase in commercial loans. Credit quality indicators stayed stable, showing only modest net charge-offs and a slight rise in non-performing assets.
Management’s outlook for 2026 aligns closely with prevailing analyst models but incorporates a more optimistic margin forecast. This positive margin development motivated Keefe, Bruyette & Woods to increase earnings estimates for 2026 and 2027 by roughly 5% each.
Recent quarterly earnings for the fourth quarter of 2025 further underscore the bank’s strong performance. Horizon Bancorp posted an EPS of $0.53, surpassing analysts’ expectations of $0.50. Revenue also beat projections, totaling $74.94 million versus an anticipated $74.35 million. These outcomes highlight the bank’s capacity for delivering results above market expectations, signaling positive momentum for investors observing Horizon Bancorp’s financial trajectory.