Piper Sandler has raised its 12-month price target for Independent Bank Corporation to $39.00, up from $36.00, while retaining a Neutral rating on the shares. The stock is currently trading at $35.02, with a market capitalization of $718 million and a reported price-to-earnings ratio of 10.6.
The research house pointed to an improved outlook for 2026 as the principal justification for the higher target. Piper Sandler now expects net interest margin (NIM) to expand by 18 to 23 basis points year-over-year in 2026 - a notable change from its prior view of flat NIM for that period. That NIM revision is paired with an assumption of mid-single-digit loan growth driven by commercial lending activity and continued low credit costs, which together underpin the firm’s view of sustained profitability.
Reflecting the stronger margin outlook, Piper Sandler raised its earnings per share estimates for 2026 and 2027 by roughly 4% to 5%, to $3.55 and $3.75, respectively. The firm’s modeled returns include a projected return on assets of 1.3% to 1.4% and a return on tangible common equity in the 14% to 15% range for the 2026/2027 timeframe.
InvestingPro data included in the research note highlights several corporate metrics: Independent Bank has increased its dividend for 12 consecutive years, recorded 16.7% dividend growth over the last twelve months, and currently offers a dividend yield of 3.2%. The same data indicates the stock may be trading above its Fair Value, a point that aligns with the observation of a relatively high P/E ratio in relation to near-term earnings growth.
Performance in the fourth quarter supported the more constructive outlook to some extent. Independent Bank reported linked-quarter annualized loan growth of 7% and maintained benign asset quality readings. Those positives were offset in part by higher operating expenses, which led to a 6% shortfall in pre-provision net revenue relative to expectations.
Piper Sandler’s $3 increase in the price target is derived from an 11.0x multiple applied to its 2026 EPS estimate. That multiple represents a premium to the peers’ 9.5x median that Piper Sandler cites; the firm attributes the premium to Independent Bank’s favorable profitability outlook, a more benign credit profile, and an accumulating excess capital position that could support merger and acquisition activity.
On the company’s most recent quarterly results, Independent Bank reported fourth-quarter 2025 earnings per share of $0.89, ahead of a $0.84 forecast. Revenue for the quarter totaled $58.31 million, falling short of an anticipated $58.73 million. The earnings beat, despite the revenue miss, was interpreted positively by the market, with the stock displaying a positive pre-market response following the announcement.
Taken together, the analyst update reflects a more upbeat view on margin dynamics and earnings potential while underlining areas of caution such as expense pressure and valuation measures. Investors and market participants will likely weigh the upgraded earnings trajectory and the premium multiple against the signals from recent revenue trends and the current P/E relative to near-term growth.