Piper Sandler Lowers South Plains Financial Rating from Overweight to Neutral
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 24 2025
0mins
Should l Buy SPFI?
Downgrade Announcement: Piper Sandler has downgraded South Plains Financial from Overweight to Neutral.
Price Target Adjustment: The price target has been reduced from $44 to $41 following the company's Q3 performance.
Reason for Downgrade: The downgrade is attributed to valuation concerns, indicating limited upside potential.
Recent Stock Performance: The decision comes after a recent rally in the stock's price.
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Analyst Views on SPFI
Wall Street analysts forecast SPFI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for SPFI is 43.67 USD with a low forecast of 41.00 USD and a high forecast of 46.00 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: 42.880
Low
41.00
Averages
43.67
High
46.00
Current: 42.880
Low
41.00
Averages
43.67
High
46.00
About SPFI
South Plains Financial, Inc. is the bank holding company for City Bank (the Bank). The Bank is an independent bank in West Texas and has additional banking operations in the Dallas, El Paso, Greater Houston, the Permian Basin, and College Station, Texas markets, and the Ruidoso, New Mexico market. It provides a range of commercial and consumer financial services to small and medium-sized businesses and individuals in its market areas. Its business activities include commercial and retail banking, along with investment, trust and mortgage services. The Bank is primarily involved in real estate, commercial, agricultural and consumer lending activities with customers throughout Texas and Eastern New Mexico. It offers a variety of deposit products, including demand deposit accounts, interest-bearing products, savings accounts and certificates of deposits. The Bank also provides a range of traditional trust products and services along with several retirement services and products.
About the author
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.
South Plains Financial Q4 2025 Earnings Highlights
- Earnings Growth: South Plains Financial reported a 17.8% increase in diluted earnings per share for the full year, with net interest income of $43 million in Q4 and a net interest margin expansion to 4%, indicating sustained profitability that is expected to drive future shareholder returns.
- Loan Growth: Loans held for investment rose by $91 million to $3.14 billion in Q4, primarily due to organic growth in multifamily property and direct energy loans, with expectations for loan growth to accelerate to mid- to high single-digit rates in 2026, further enhancing earning power.
- Acquisition Strategy: The company has reached a definitive agreement to acquire BOH Holdings, expected to be approximately 11% accretive to earnings by 2027 with a payback period of less than three years, demonstrating strategic decision-making aimed at expanding market share and improving balance sheet quality.
- Dividend Continuity: The Board authorized a quarterly dividend of $0.17 per share, marking the 27th consecutive dividend, reflecting the company's commitment to returning value to shareholders while maintaining growth in profitability and enhancing investor confidence.
See More
South Plains Financial Q4 Earnings Beat Expectations
- Earnings Beat: South Plains Financial reported Q4 GAAP EPS of $0.90, exceeding expectations by $0.05, indicating strong profitability that boosts investor confidence.
- Revenue Miss: Revenue increased by 3.9% year-over-year to $53.88 million but fell short of expectations by $0.23 million, reflecting the impact of intensified market competition and economic uncertainty on growth.
- Acquisition Announcement: The company plans to acquire BOH Holdings in a $105.9 million all-stock deal, which not only aims to expand market share but also potentially enhances overall operational efficiency through resource integration.
- Quant Rating Insight: Seeking Alpha's Quant Rating highlights market attention on South Plains Financial's future performance, prompting investors to closely monitor the integration progress post-acquisition and its implications for financial health.
See More
Small Banks Thrive with PE Ratios Below 11 Amid Market Optimism
- Banking Resilience: Small and regional banks have demonstrated strong performance after enduring a 500 basis point rate shock, maintaining historical high capital ratios, indicating robust risk resilience and potential for increased profitability in the future.
- PE Ratio Advantage: While money center banks trade at forward PE ratios between 13 and 16, small and regional banks are priced below 11, growing faster, suggesting that investors can achieve higher returns by opting for smaller banks.
- Yield Attractiveness: For instance, Huntington offers a yield three times that of JP Morgan, highlighting the appeal of small banks in terms of yield distribution, which has garnered increased investor interest.
- Rapidly Growing Community Banks: Third Coast Bankshares and South Plains Financial in Texas are among the fastest-growing community banks, priced at or below 11 times forward PE ratios, showcasing their competitive edge and investment potential in the market.
See More
South Plains Financial Acquires BOH Holdings for $106 Million
- Strategic Acquisition: South Plains Financial has entered into a definitive merger agreement with BOH Holdings valued at approximately $106 million in an all-stock transaction, expected to close between Q1 and Q2 2026, significantly enhancing its business footprint in high-growth Texas markets.
- Asset Expansion: The acquisition is projected to add approximately $772 million in assets, bringing total assets to $5.4 billion, thereby strengthening South Plains' commercial and private banking relationships in the Houston area and driving organic loan growth.
- Cost Savings: The merger is expected to achieve around 25% in operating cost savings, fully realized by 2027, which will enhance the company's profitability and competitive positioning in the market.
- Cultural Fit: Both organizations operate community banking models focused on relationship lending and disciplined credit management, with the loan portfolio expected to remain stable post-merger, thereby reducing integration risks and promoting long-term profitability.
See More
South Plains Financial Acquires BOH Holdings for $106 Million
- Strategic Acquisition: South Plains Financial has entered into a merger agreement with BOH Holdings valued at approximately $106 million, expected to close between Q1 and Q2 of 2026, aimed at enhancing its relationship-focused banking operations in high-growth Texas markets.
- Asset Expansion: The acquisition is projected to add about $772 million in assets, bringing total assets to $5.4 billion, with $3.8 billion in loans and $4.6 billion in deposits, significantly boosting the company's competitive position in the market.
- Cost Savings: The merger is expected to yield approximately 25% in operating cost savings, fully realized by 2027, thereby enhancing the company's profitability and financial stability.
- Cultural Fit: Both organizations operate community banking models focused on relationship lending and disciplined credit management, indicating a high cultural compatibility that reduces integration risks and facilitates a smooth merger process.
See More
South Plains Financial to Acquire BOH Holdings for $105.9 Million
- Transaction Scale: South Plains Financial has entered into a merger agreement with BOH Holdings valued at approximately $105.9 million, which is expected to enhance South Plains' market position in Texas.
- Asset Integration: Post-merger, the combined entity will have approximately $5.4 billion in assets, $3.8 billion in loans, and $4.6 billion in deposits, further solidifying its business in the Houston area.
- Earnings Outlook: The transaction is expected to be 11% accretive to South Plains' earnings per share in 2027, indicating strong potential for profit growth.
- Market Expansion: This acquisition will increase the number of branches in the Houston metropolitan area, further extending South Plains' influence in one of the fastest-growing markets in the country.
See More
South Plains Financial Q4 2025 Earnings Highlights
- Earnings Growth: South Plains Financial reported a 17.8% increase in diluted earnings per share for the full year, with net interest income of $43 million in Q4 and a net interest margin expansion to 4%, indicating sustained profitability that is expected to drive future shareholder returns.
- Loan Growth: Loans held for investment rose by $91 million to $3.14 billion in Q4, primarily due to organic growth in multifamily property and direct energy loans, with expectations for loan growth to accelerate to mid- to high single-digit rates in 2026, further enhancing earning power.
- Acquisition Strategy: The company has reached a definitive agreement to acquire BOH Holdings, expected to be approximately 11% accretive to earnings by 2027 with a payback period of less than three years, demonstrating strategic decision-making aimed at expanding market share and improving balance sheet quality.
- Dividend Continuity: The Board authorized a quarterly dividend of $0.17 per share, marking the 27th consecutive dividend, reflecting the company's commitment to returning value to shareholders while maintaining growth in profitability and enhancing investor confidence.
See More
South Plains Financial Q4 Earnings Beat Expectations
- Earnings Beat: South Plains Financial reported Q4 GAAP EPS of $0.90, exceeding expectations by $0.05, indicating strong profitability that boosts investor confidence.
- Revenue Miss: Revenue increased by 3.9% year-over-year to $53.88 million but fell short of expectations by $0.23 million, reflecting the impact of intensified market competition and economic uncertainty on growth.
- Acquisition Announcement: The company plans to acquire BOH Holdings in a $105.9 million all-stock deal, which not only aims to expand market share but also potentially enhances overall operational efficiency through resource integration.
- Quant Rating Insight: Seeking Alpha's Quant Rating highlights market attention on South Plains Financial's future performance, prompting investors to closely monitor the integration progress post-acquisition and its implications for financial health.
See More
Small Banks Thrive with PE Ratios Below 11 Amid Market Optimism
- Banking Resilience: Small and regional banks have demonstrated strong performance after enduring a 500 basis point rate shock, maintaining historical high capital ratios, indicating robust risk resilience and potential for increased profitability in the future.
- PE Ratio Advantage: While money center banks trade at forward PE ratios between 13 and 16, small and regional banks are priced below 11, growing faster, suggesting that investors can achieve higher returns by opting for smaller banks.
- Yield Attractiveness: For instance, Huntington offers a yield three times that of JP Morgan, highlighting the appeal of small banks in terms of yield distribution, which has garnered increased investor interest.
- Rapidly Growing Community Banks: Third Coast Bankshares and South Plains Financial in Texas are among the fastest-growing community banks, priced at or below 11 times forward PE ratios, showcasing their competitive edge and investment potential in the market.
See More
South Plains Financial Acquires BOH Holdings for $106 Million
- Strategic Acquisition: South Plains Financial has entered into a definitive merger agreement with BOH Holdings valued at approximately $106 million in an all-stock transaction, expected to close between Q1 and Q2 2026, significantly enhancing its business footprint in high-growth Texas markets.
- Asset Expansion: The acquisition is projected to add approximately $772 million in assets, bringing total assets to $5.4 billion, thereby strengthening South Plains' commercial and private banking relationships in the Houston area and driving organic loan growth.
- Cost Savings: The merger is expected to achieve around 25% in operating cost savings, fully realized by 2027, which will enhance the company's profitability and competitive positioning in the market.
- Cultural Fit: Both organizations operate community banking models focused on relationship lending and disciplined credit management, with the loan portfolio expected to remain stable post-merger, thereby reducing integration risks and promoting long-term profitability.
See More
South Plains Financial Acquires BOH Holdings for $106 Million
- Strategic Acquisition: South Plains Financial has entered into a merger agreement with BOH Holdings valued at approximately $106 million, expected to close between Q1 and Q2 of 2026, aimed at enhancing its relationship-focused banking operations in high-growth Texas markets.
- Asset Expansion: The acquisition is projected to add about $772 million in assets, bringing total assets to $5.4 billion, with $3.8 billion in loans and $4.6 billion in deposits, significantly boosting the company's competitive position in the market.
- Cost Savings: The merger is expected to yield approximately 25% in operating cost savings, fully realized by 2027, thereby enhancing the company's profitability and financial stability.
- Cultural Fit: Both organizations operate community banking models focused on relationship lending and disciplined credit management, indicating a high cultural compatibility that reduces integration risks and facilitates a smooth merger process.
See More
South Plains Financial to Acquire BOH Holdings for $105.9 Million
- Transaction Scale: South Plains Financial has entered into a merger agreement with BOH Holdings valued at approximately $105.9 million, which is expected to enhance South Plains' market position in Texas.
- Asset Integration: Post-merger, the combined entity will have approximately $5.4 billion in assets, $3.8 billion in loans, and $4.6 billion in deposits, further solidifying its business in the Houston area.
- Earnings Outlook: The transaction is expected to be 11% accretive to South Plains' earnings per share in 2027, indicating strong potential for profit growth.
- Market Expansion: This acquisition will increase the number of branches in the Houston metropolitan area, further extending South Plains' influence in one of the fastest-growing markets in the country.
See More
