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A Look At Atlantic Union Bankshares (AUB) Valuation After Its Latest Quarterly Earnings

Simply Wall St · 5d ago

Atlantic Union Bankshares (AUB) shares moved higher after quarterly earnings showed revenue growth and earnings per share in line with expectations, even as net interest income fell short and sector conditions influenced investor sentiment.

See our latest analysis for Atlantic Union Bankshares.

The recent post earnings move, with the share price at US$35.52, comes after a mixed few months where the 30 day share price return of 3.29% contrasts with a slightly negative 90 day move. At the same time, the 1 year total shareholder return of 0.24% and 5 year total shareholder return of 16.73% point to steadier progress over a longer horizon, suggesting momentum has been rebuilding rather than fading.

If Atlantic Union Bankshares has you looking more closely at regional lenders and financials, it could be a good moment to broaden your watchlist with fast growing stocks with high insider ownership.

With revenue and net income growth on the table, a recent earnings miss in one area, and the share price still below some analyst estimates, is Atlantic Union Bankshares offering a mispriced entry point, or is the market already baking in future growth?

Most Popular Narrative: 16.3% Undervalued

With Atlantic Union Bankshares last closing at US$35.52 against a narrative fair value of US$42.44, the valuation hinges on a powerful earnings and margin story that stretches several years out.

The company's geographic expansion into fast-growing markets in North Carolina, Maryland, and Northern Virginia, supported by recent acquisitions and plans to open 10 new branches in the Research Triangle and Wilmington, positions Atlantic Union to capture increased population and economic growth in the U.S. Southeast, driving above-peer organic loan and deposit growth over the coming years and lifting revenues.

The successful integration of Sandy Spring Bank and the sale of $2 billion in commercial real estate loans have reduced risk concentrations, freed up lending capacity, and expanded the company's customer base in markets with the lowest unemployment nationally, supporting better credit performance, new fee income, and future earnings upside.

Read the complete narrative.

Curious how revenue, earnings and valuation multiples are all expected to shift to justify that higher fair value line? The narrative leans heavily on faster top line growth, wider margins, and a different earnings multiple a few years from now. The exact mix of those assumptions is where the story really gets interesting.

Result: Fair Value of $42.44 (UNDERVALUED)

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

However, this hinges on regional growth and smooth M&A integration. Setbacks on either front could pressure credit quality, expenses, and the earnings path underpinning that narrative.

Find out about the key risks to this Atlantic Union Bankshares narrative.

Build Your Own Atlantic Union Bankshares Narrative

If you look at the assumptions and feel they miss something, or simply prefer to test your own view against the data, you can build a custom narrative in just a few minutes using Do it your way.

A great starting point for your Atlantic Union Bankshares research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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If Atlantic Union Bankshares is on your radar, do not stop there, use the Simply Wall St screener to quickly uncover other angles that could suit your approach.

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.