Barclays Raises SouthState's Price Target to $117 Amid Positive Outlook

Barclays analyst Jared Shaw raised SouthState's (SSB) price target from $115 to $117, maintaining an "Overweight" rating. This suggests confidence in the company's potential for growth. The average target price from 12 analysts is $112.25, with a high estimate of $120 and a low of $97. The average brokerage recommendation is 1.8, indicating "Outperform" status.

Barclays analyst Jared Shaw has increased the price target for SouthState Corporation (NASDAQ: SSB) from $115 to $117, maintaining an "Overweight" rating. This move reflects Shaw's confidence in the company's potential for growth. The average target price among 12 analysts stands at $112.25, with a high estimate of $120 and a low of $97. The average brokerage recommendation is 1.8, indicating an "Outperform" status [2].

SouthState Corporation, a regional banking powerhouse, has shown resilience and growth in recent quarters. The company's Q1 results demonstrated a net interest margin (NIM) of 3.85%, well above the industry average of 3.2%, and an adjusted return on assets (ROA) of 1.38% and a 20% return on equity (ROE). Loan pipelines have increased by 44% year-to-date, with commercial real estate (CRE) and commercial and industrial (CNI) sectors leading the charge [2].

The company's strategic positioning in high-growth regions like Florida and Atlanta, along with its recent acquisition of Independent Financial, has expanded its footprint without overextending. This move has not only increased its asset base but also positioned it to capitalize on market opportunities [2].

Barclays' optimistic view aligns with the broader market sentiment. SouthState's stock has appreciated by 17% over the past year, outperforming peers like Zions Bancorp (ZION) and Comerica (CMA). The company's capital strength, with a common equity tier 1 (CET1) ratio of 11%, provides a cushion against potential economic headwinds. Additionally, its net charge-offs of just 4 basis points and provision for credit losses of $8 million suggest minimal defaults, even in a slowing economy [2].

The upcoming Q2 earnings report, scheduled for July 24, is expected to provide further insight into the company's performance. Analysts anticipate a NIM stability between 3.80%-3.90% and strong loan growth, particularly in the CRE and CNI sectors. This could lead to potential capital deployment, such as dividends or buybacks later in 2025 [2].

Technically, SouthState is a textbook "Strong Buy." The stock is trading at 15.0x forward earnings, well below the 18x average for regional banks. The relative strength index (RSI) of 94 indicates further momentum, and short interest is low, with institutional ownership climbing [2].

Barclays' upgrade, coupled with the company's strong fundamentals and strategic positioning, suggests that SouthState Corporation is well-positioned for continued growth. However, investors should remain vigilant to potential risks, such as loan pricing pressure and recession risks in the industrial CRE sector. Overall, the upgrade provides a compelling case for investing in SouthState Corporation.

References:

[1] https://site.financialmodelingprep.com/market-news/fmp-mizuho-slashes-leslie%E2%80%99s-price-target-to-$1-shares-drops-4
[2] https://www.ainvest.com/news/southstate-corporation-a-regional-banking-powerhouse-poised-to-soar-on-q2-earnings-25071010e5c06a96d4ecadf2/
[3] https://www.marketbeat.com/stocks/NYSE/AX/earnings/