Columbia Banking System: Strong Buy As Contrarian EPS Inflection Drives Upside

Moretus Research
545 Followers
(12min)

Summary

  • We initiate Columbia Banking System with a Strong Buy rating, underscoring a sharp contrarian 2026 EPS inflection the market is mispricing.
  • Our implied valuation is pegged to our $40 price target, which offers a 73% upside at an 11.7x forward P/E multiple on our 2026 EPS estimate.
  • Our internal estimates assume a material dip in FY25E EPS on M&A charges/accounting provisions, followed by a dramatic 36% EPS rebound to $3.40 in FY26E, 11% ahead of.
  • Risks to our thesis include delayed synergy capture from the Pacific Premier merger or unexpected credit deterioration, which could push out or dilute the anticipated earnings recovery.

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Key Thesis

We initiate coverage of Columbia Banking System, Inc. (NASDAQ:COLB) with a Strong Buy rating and $40 PT. Columbia Banking System, Inc. is a leading regional bank that provides banking services to small and medium businesses, professionals, and individuals in the Pacific

This article was written by

Moretus Research
545 Followers
Moretus Research delivers state-of-the-art, buy-side quality equity research for serious investors seeking clarity, conviction, and alpha. Focused on U.S. public markets, Moretus applies a structured, repeatable framework to identify companies with durable business models, mispriced cash flow potential, and intelligent capital allocation. Built on institutional standards, Moretus Research combines rigorous fundamental analysis with a high-signal, judgment-driven process—eschewing noise, narrative, and overly complex forecasting. Valuation is based on pragmatic, sector-relevant multiples tailored to each company’s business model and capital structure, with an emphasis on comparability, simplicity, and relevance. Research coverage tends to favor underappreciated companies undergoing structural change or temporary dislocation—situations where dispassionate analysis and variant perception can lead to asymmetric returns. All work reflects a deep respect for capital, discipline, and long-term compounding. Moretus Research aims to raise the standard for independent investment research—providing professional-grade insights, actionable valuation, and a strong filter for what truly matters in modern equity analysis.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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