Last Update17 Oct 25Fair value Decreased 2.48%
The analyst price target for Pinnacle Financial Partners has been lowered modestly, with the average fair value estimate falling from approximately $112.08 to $109.31. Analysts cite the upcoming Synovus merger, ongoing integration risks, and mixed expectations for future performance as reasons for this adjustment.
Analyst Commentary
Recent analyst reports reflect a range of opinions on Pinnacle Financial Partners in the wake of its announced merger with Synovus. Analysts continue to adjust models and price targets as new information emerges, highlighting both opportunities and risks associated with the deal and the bank’s forward outlook.
Bullish Takeaways- Bullish analysts continue to view Pinnacle’s long-term growth prospects favorably, citing updated revenue estimates and the potential for performance improvement after the merger.
- Some believe the Synovus merger could position the combined bank as a leading regional competitor with significant scale in the Southeast, creating new opportunities for market expansion.
- Despite some lowered price targets, Buy and Outperform ratings remain in place, which reflects confidence in the underlying business and management’s ability to execute over time.
- Bearish analysts highlight increased execution and integration risk from the Synovus merger and warn that extended timelines to full integration could hamper performance until at least 2027.
- Concerns remain that forming a larger, more complex bank in a short period introduces operational challenges and uncertainty, especially when trying to maintain momentum during the transition.
- Several have lowered their near-term price targets and emphasize that limited upside is expected until integration is complete and results are proven, leading to more cautious ratings such as Equal Weight or Market Perform.
- There is a sense that, for now, Pinnacle is trading more in line with peers, with analysts waiting for clear evidence of successful merger execution and realization of synergies before becoming more positive.
What's in the News
- Reported net loan charge-offs for Q3 2025 totaled $16.8 million, compared with $18.3 million in the same period last year (Key Developments).
- A Special/Extraordinary Shareholders Meeting is scheduled for November 6, 2025 (Key Developments).
- No shares were repurchased by the company in the buyback tranche from April through June 2025, with $0 million deployed (Key Developments).
Valuation Changes
- Consensus Analyst Price Target (fair value) has decreased modestly from $112.08 to $109.31.
- Discount Rate has risen slightly from 6.78% to 6.79%.
- Revenue Growth projection has edged down, moving from 58.28% to 57.93%.
- Net Profit Margin estimate has increased notably, from 26.84% to 30.48%.
- Future P/E ratio forecast has fallen from 5.52x to 4.59x, which suggests expectations for improved earnings relative to price.
Key Takeaways
- Expansion in fast-growing Southern markets and focus on personalized banking drives robust customer acquisition, supporting strong revenue, loan, and deposit growth even in difficult environments.
- Talent acquisition from major competitors and ongoing digital investments enhance efficiency and profitability, while regulatory changes may create further growth and consolidation opportunities.
- Heavy exposure to regional markets, competition from fintechs, talent strategy risks, CRE lending stress, and margin pressures could restrain growth and profitability.
Catalysts
About Pinnacle Financial Partners- Operates as the bank holding company for Pinnacle Bank that provides various banking products and services to individuals, businesses, and professional entities in the United States.
- Migration-driven population and business growth in high-opportunity Sun Belt and Southeast markets continues to broaden Pinnacle's customer base, resulting in outsized loan and deposit growth even during challenging macro and rate cycles; this structurally supports double-digit revenue and net interest income growth.
- The increasing formation of small and mid-sized businesses in the region is increasing demand for relationship-based, customized banking-Pinnacle's high-touch model successfully captures this, which should fuel sustained commercial loan and fee income growth.
- Strategic hiring of experienced revenue producers directly from large competitors-combined with rapid integration and high asset quality-enables organic balance sheet expansion at a pace (10–13% asset and deposit growth) far above industry medians, supporting reliable EPS and tangible book value per share growth.
- Continued investment in digital banking and operational technology is driving improved efficiency ratios and cost leverage, positioning Pinnacle to enhance net margins and earnings even as branch-based expenses decrease.
- Recent regulatory easing and industry consolidation trends could lower compliance burdens and create new M&A or market entry opportunities for well-capitalized, agile operators like Pinnacle, potentially boosting capital deployment flexibility and long-term earnings power.
Pinnacle Financial Partners Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming Pinnacle Financial Partners's revenue will grow by 58.3% annually over the next 3 years.
- Analysts assume that profit margins will shrink from 32.1% today to 26.8% in 3 years time.
- Analysts expect earnings to reach $1.9 billion (and earnings per share of $10.77) by about September 2028, up from $581.7 million today.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 5.5x on those 2028 earnings, down from 12.9x today. This future PE is lower than the current PE for the US Banks industry at 11.9x.
- Analysts expect the number of shares outstanding to grow by 0.52% per year for the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 6.78%, as per the Simply Wall St company report.
Pinnacle Financial Partners Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- Pinnacle's heavy concentration in the Southeastern U.S. and focus on deepening current high-growth metropolitan markets increases exposure to regional economic shocks or demographic changes, which could negatively impact loan demand and revenue growth if those markets slow down.
- The ongoing digitalization of financial services and rising competition from fintechs and large, tech-enabled banks could erode Pinnacle's customer base and compress net interest margins or fee income, thereby restraining longer-term earnings growth.
- Pinnacle's aggressive reliance on hiring experienced revenue producers as the primary growth driver introduces risks if the market for talent becomes less favorable, or if competitors replicate this strategy, potentially leading to higher compensation expenses and muted revenue expansion, impacting net margin and earnings.
- Continued or future exposure to commercial real estate (CRE) lending-should CRE markets face sustained stress-raises the risk of higher loan losses and provision expenses, which could reduce profitability and suppress tangible book value growth.
- An extended flat or inverted yield curve, or prolonged margin pressure from high interest rates, may limit further net interest income growth if deposit costs rise more quickly than asset yields, constraining net interest margin and ultimately earnings momentum.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of $112.083 for Pinnacle Financial Partners based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $130.0, and the most bearish reporting a price target of just $95.0.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $7.2 billion, earnings will come to $1.9 billion, and it would be trading on a PE ratio of 5.5x, assuming you use a discount rate of 6.8%.
- Given the current share price of $97.58, the analyst price target of $112.08 is 12.9% higher.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
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Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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