Morgan Stanley analyst Jeffrey Adelson maintained a Hold rating on SLM today and set a price target of $27.00.
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Jeffrey Adelson has given his Hold rating due to a combination of factors tied to SLM’s credit performance and current valuation. Recent trust data show net charge-offs running above both his and the market’s expectations, with April loss rates exceeding typical seasonal patterns and suggesting second-quarter credit costs could land roughly 20 basis points higher than his model and even further above consensus.
At the same time, delinquency trends are somewhat more nuanced, coming in better than usual for April but still advancing notably compared with last year once the impact of newly added trusts is stripped out. Given that credit metrics are deteriorating on a year-over-year basis, yet not severely enough to justify a more negative stance, and with the shares already trading near his risk-reward assumptions and an unchanged $27 price target, he sees limited upside relative to risks and therefore maintains a Hold recommendation.
Adelson covers the Financial sector, focusing on stocks such as SLM, UWM Holding, and Capital One Financial. According to TipRanks, Adelson has an average return of -9.6% and a 38.30% success rate on recommended stocks.