BFST Stock Forecast & Price Target

Business First Bancshares is a bank holding company that offers a range of financial services to small-to-midsized businesses and professionals. With a strong focus on interest income from loans and securities, the company has been able to steadily grow its revenues. The recent decrease in non-performing loans and expenses, along with the expected growth from the Progressive deal cost savings, should result in improved profitability over the next two quarters. Risks to achieving the target price of $35 include various industry and energy-related factors, along with potential M&A challenges. The company reported strong earnings for the second quarter, with increases in net interest income and a decrease in non-interest expenses offsetting slower fee income growth. Despite a modest earnings miss, the company's profitability metrics remain solid and are expected to improve in the second half of the year, which supports a Buy rating with a revised price target of $35. However, potential risks to achieving this target include economic deterioration in the bank's core markets and unexpected credit quality deterioration.

Business First Bancshares is expected to see minimal improvements in the near term, with a projected flat net interest margin and modest NII growth for 2026 and 2027. The company's NPA and NCO rates have improved slightly, but the decline in core end of period loans raises concerns about its ability to grow organically. Additionally, the lower-than-expected purchase accounting rate marks and declining loan yields may hinder future earnings.