First Bank (FRBA) Stock Forecast & Price Target

First Bank is viewed positively because the small business credit issue appears isolated in a relatively small book of less than $100M, while management expects further charge-offs to moderate and believes much of the stress is already reserved for, supported by a healthy 1.39% total allowance. Although elevated net charge-offs of about 60 bps and a 20 bps rise in NPAs to 0.66% warrant caution, the bank’s strong LTV/DSCR protection and continued focus on disciplined underwriting suggest the credit profile remains manageable. Additional support comes from potential buybacks, as the remaining $20M authorization, or roughly 5% of shares, could still leave capital ample at 12.5% TRBC, enhancing shareholder value.

First Bank is facing a weak earnings outlook because 1Q26 results missed expectations on elevated provisions tied to small business lending losses and higher compensation expenses, while estimated 2026 EPS was cut to $1.49 from $1.93. The bank’s fundamentals also look pressured by flat-to-slight NIM expansion at 3.68% in 2Q26, only about 5% loan growth, and just 3% deposit growth as funding costs shift toward higher-cost CDs. Credit risk remains a key drag, with provisions modeled near $3 million per quarter through 2027, NPLs expected to rise to about 1.0% of loans, and profitability likely stuck at or below a 1% ROA and 10% ROTCE.