PCB Bancorp. (PCB) Stock Forecast & Price Target

PCB Bancorp's growth outlook is bolstered by a projected increase in net interest income (NII) of 3-4% relative to earlier estimates, reflecting an expected 18% growth in 2025 and 10% in 2026. The bank's successful balance sheet expansion and effective management of deposit costs have positively influenced margin expectations, which have been adjusted to 3.32%/3.31%, slightly above previous forecasts. Additionally, the company demonstrated strong expense control, with a modest 3.5% increase in expenses despite significant professional fees associated with the ECIP restatement.

PCB Bancorp's financial performance shows signs of weakness, highlighted by a 6% decline in end-of-period loan balances, primarily driven by significant reductions in commercial and industrial loans, notably in the mortgage warehouse sector, as well as decreased production figures. The company also reported core net interest earnings (NIE) below guidance at $14.9 million, with a notable underperformance in loan loss provisioning expectations, raising concerns about the sustainability of its earnings in the near term. Additionally, despite trading at a price-to-tangible-book-value (TBV) ratio of 1.0x, which appears discounted relative to the broader market, the bank's return on tangible common equity (ROTCE) remains 150 basis points lower than its small and mid-cap peers, reflecting ongoing profitability challenges.