Evaluating OFG Bancorp's Valuation Following a Recent Decline in Share Price Momentum
Written by Emily J. Thompson, Senior Investment Analyst
Source: Yahoo Finance
Updated: 9 hour ago0mins
OFG Bancorp Performance: OFG Bancorp shares have underperformed recently, with a 90-day return of -8.75% and a year-to-date return of -2.72%, despite the bank's revenue growth and profitability.
Valuation Insights: The current share price of $40.47 is below analyst targets, suggesting potential undervaluation, with a fair value estimated at $50, contingent on growth and margin assumptions.
Growth Drivers: The bank's digital banking expansion is enhancing customer engagement and operational efficiency, which may lead to improved net margins and revenue growth in the future.
Risks and Considerations: Competition for loans and deposits, along with economic vulnerabilities in Puerto Rico, pose risks that could impact margins and the bank's valuation outlook.
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Analyst Views on OFG
Wall Street analysts forecast OFG stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for OFG is 47.00 USD with a low forecast of 43.00 USD and a high forecast of 50.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
3 Analyst Rating
2 Buy
1 Hold
0 Sell
Moderate Buy
Current: 40.580
Low
43.00
Averages
47.00
High
50.00
Current: 40.580
Low
43.00
Averages
47.00
High
50.00
Wells Fargo
Timur Braziler
Equal Weight
downgrade
$48 -> $43
2025-10-27
Reason
Wells Fargo
Timur Braziler
Price Target
$48 -> $43
2025-10-27
downgrade
Equal Weight
Reason
Wells Fargo analyst Timur Braziler lowered the firm's price target on OFG Bancorp to $43 from $48 and keeps an Equal Weight rating on the shares. The firm sees tough stretch ahead, as rate cuts plus heightened deposit competition likely weigh on net interest income through much of the first half of 2026.
Wells Fargo
Timur Braziler
Overweight
downgrade
$25 -> $23
2025-10-27
Reason
Wells Fargo
Timur Braziler
Price Target
$25 -> $23
2025-10-27
downgrade
Overweight
Reason
Wells Fargo analyst Timur Braziler lowered the firm's price target on First BanCorp (FBP) to $23 from $25 and keeps an Overweight rating on the shares. The firm remains bullish on the name on best ROTCE and capital return story in PR, despite increased deposit competition from OFG (OFG) and rate cuts weighing on the net interest income outlook. PR economy continues to diverge from the mainland, and First BanCorp should benefit, Wells argues.
Truist
Arren Cyganovich
Buy
downgrade
$50 -> $48
2025-10-23
Reason
Truist
Arren Cyganovich
Price Target
$50 -> $48
2025-10-23
downgrade
Buy
Reason
Truist analyst Arren Cyganovich lowered the firm's price target on OFG Bancorp to $48 from $50 and keeps a Buy rating on the shares after its Q3 earnings miss. Two areas impacted results during the quarter - higher credit costs and net interest margin - though with that said, the driver of the more conservative net interest margin guide was partly due to chunky commercial loan repayments and partly due to retail deposit customer acquisitions, the analyst tells investors in a research note.
Keefe Bruyette
Outperform
maintain
$51 -> $50
2025-10-23
Reason
Keefe Bruyette
Price Target
$51 -> $50
2025-10-23
maintain
Outperform
Reason
Keefe Bruyette lowered the firm's price target on OFG Bancorp to $50 from $51 and keeps an Outperform rating on the shares post the Q3 report. The firm still likes OFG's positioning as the "challenger bank" in Puerto Rico.
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About OFG
OFG Bancorp is a financial holding company. The Company is engaged in providing banking and financial services through its subsidiaries. The Company operates through three segments: Banking, Wealth Management and Treasury. The Company provides banking and financial services to its clients through a range of banking and financial solutions, including commercial, consumer, auto, and mortgage lending; checking and savings accounts; financial planning, insurance, financial service, and investment brokerage, and corporate and individual trust and retirement services. The Company provides these services through various subsidiaries, including a commercial bank, Oriental Bank; a securities broker-dealer, Oriental Financial Services Corp. (Oriental Financial Services); an insurance agency, Oriental Insurance, LLC (Oriental Insurance), and a retirement plan administrator, Oriental Pension Consultants, Inc. (OPC).
About the author
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Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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What factors contributed to OFG Bancorp's recent decline in share price momentum?
How does OFG Bancorp's current valuation compare to analyst target estimates?
Will OFG Bancorp's digital banking expansion significantly improve its future revenue growth?
Can OFG Bancorp overcome economic vulnerabilities in Puerto Rico to sustain growth?