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Western Alliance (WAL) Valuation After Fed’s Third Rate Cut and Renewed Regional Bank Optimism

Simply Wall St · 1d ago

The latest move in Western Alliance Bancorporation (WAL) came right after the Federal Reserve delivered its third interest rate cut of the year, a shift toward easier money that typically lifts regional bank sentiment.

See our latest analysis for Western Alliance Bancorporation.

That Fed driven bounce comes after a choppy spell, with a 10.26% 1 month share price return but a modest 1 year total shareholder return of minus 0.58%. This suggests momentum is rebuilding, yet investors remain cautious despite new board level risk expertise and recent SME banking accolades.

If this kind of rate sensitive move has your attention, it could be a good moment to explore fast growing stocks with high insider ownership as potential next wave opportunities.

Western Alliance now trades at a near 17% discount to analyst targets and an even deeper range on intrinsic models. Yet three and five year returns already look strong, so is this a fresh value entry or is future growth already priced in?

Most Popular Narrative: 15.6% Undervalued

With Western Alliance Bancorporation’s fair value set above the recent 86.18 close, the prevailing narrative frames today’s price as leaving notable upside on the table.

The analysts have a consensus price target of $97.8 for Western Alliance Bancorporation 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 $105.0, and the most bearish reporting a price target of just $85.0.

Read the complete narrative.

If you are curious how revenue, margins and earnings are projected to evolve to support that future valuation path, and what kind of multiple is quietly built in, you can dive into the full narrative to see the financial blueprint driving this fair value call.

Result: Fair Value of $102.06 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, sizeable commercial real estate exposure and looming higher regulatory and compliance costs could yet challenge that optimistic fair value story.

Find out about the key risks to this Western Alliance Bancorporation narrative.

Build Your Own Western Alliance Bancorporation Narrative

If you see the story differently or want to stress test the numbers yourself, you can quickly build a personalized view in minutes: Do it your way.

A great starting point for your Western Alliance Bancorporation research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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Before you move on, consider running fresh screens on new opportunities so you do not risk missing the next phase of market leading gains.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.