TD Cowen analyst Moshe Orenbuch maintained a Buy rating on SLM today and set a price target of $40.00.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Moshe Orenbuch has given his Buy rating due to a combination of factors, primarily focusing on the improvement in net charge-offs (NCOs) and the performance of newer loan vintages. Despite an increase in delinquencies, the NCO rate for total loans decreased significantly in July, which is a positive indicator compared to historical trends. This suggests better management of loan losses and an overall healthier loan portfolio.
Additionally, while newer loan vintages initially performed worse than older ones, July showed a notable improvement in their performance. The decline in NCOs for these newer issues was substantial, indicating a positive shift. This improvement in newer vintages aligns with trends observed in other consumer lenders, reinforcing confidence in SLM’s ability to manage its loan portfolio effectively. These factors collectively support the Buy rating, suggesting potential for future growth and stability.