INBK Stock Forecast & Price Target

First Internet Bancorp demonstrated significant performance improvements, with end-of-period (EOP) deposits experiencing a robust increase of 29% quarter-over-quarter, supported by successful partnerships with fintech companies. The company also achieved margin expansion, attributed to a rise in the yield on average earning assets, which reached 5.65%. Additionally, EOP loans rose by 10% quarter-over-quarter, indicating solid growth in lending activities within its commercial banking segment.

First Internet Bancorp experienced a significant decline in noninterest income, which fell by 46.7% quarter-over-quarter and 49.6% year-over-year, primarily driven by lower gains from other services despite some offset from increased other income. There is increasing caution regarding near-term credit performance, particularly in the company's relatively new SBA and franchise finance portfolios, which could deteriorate in a recessionary environment. Although the bank may benefit from Federal Reserve rate cuts, its shares trade at a low multiple of tangible book value due to declining returns, reduced capital levels, and an uncertain credit outlook, signaling financial instability.