Unity Bancorp Q2 adjusted profit beats expectations, net income up 42%

Overview

• Unity Bancorp Q2 adjusted EPS beats analyst expectations, per LSEG data

• Net income rises to $16.5 mln, driven by one-time securities gains

• Loan balances grew $37.5 mln, reflecting strong origination capabilities

Outlook

• Unity Bancorp expects strong loan demand due to robust economic growth.

• Company anticipates potential rate cuts could boost economic growth.

• Unity Bancorp's loan pipeline remains robust for the second half of the year.

• Company sees stabilized inflation, potentially leading to stronger growth.

Result Drivers

• ONE-TIME GAINS - Net income boosted by $3.5 million from securities sale and $2.0 million credit loss release

• LOAN GROWTH - Loan balances increased by $37.5 million in Q2, reflecting strong origination capabilities

• CREDIT QUALITY - Nonaccrual assets declined to 0.54% of total assets, indicating stable credit quality

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for Unity Bancorp Inc is $53.00, about 0.7% above its July 14 closing price of $52.65

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 8 three months ago

Press Release: ID:nGNXbP1W1t