FULT: Discontinuing Coverage of Fulton Financial Corporation with a Final Price Target of $17.00 and a Final Rating of Neutral.
Fulton Financial Corporation (FULT – NASDAQ GS – Recent Intraday Price: $15.25)
Rating: Neutral / Buy Price: $15.00 / Target (Sell) Price: $17.00
Summary: We are discontinuing coverage of Fulton Financial Corporation (FULT) as part of a reallocation of resources in our Research Department. Our outlook for FULT remains unchanged. We are maintaining our 2020 and 2021 EPS estimates of $1.41 and $1.47. We are also maintaining our $17.00 price target, which is based on a 12.0x EPS multiple applied to our $1.41 EPS estimate for 2020. We are maintaining our Neutral rating on shares of FULT.
A note about the Corona Virus and related market turmoil: We recognize that our earnings estimates and price targets were established prior to the full-blown worries about the Corona Virus taking a toll on the market. The possibility that the Corona Virus could impact worldwide economic growth in 2020 is certainly real. However, the length and extent of any economic disruptions are very speculative at this point. We have chosen not to alter our earnings estimates for this reason. Furthermore, our valuation and price target are based on the market multiples from several weeks ago, prior to the recent market correction. We currently believe any economic impact from the Corona Virus will be felt in 2020. We do not expect the impact to extend indefinitely and carry into 2021. A year from now, stocks should be trading on expectations for 2021 earnings, a period that should bear few signs of any Corona Virus impact. We believe that the EPS multiple we are using for our price target is reasonable and that our price target remains valid, despite the recent downturn in the markets.