First Interstate BancSystem: Analysts May Be Too Pessimistic Going Into 2026
Summary
- First Interstate BancSystem is a regional bank focused on real estate financing in the Midwest and Pacific Northwest.
- The bank reported higher Q2 2025 earnings, benefiting from lower deposit costs and gradually rising yields on maturing loans and investment securities.
- Looking ahead to 2026, the net interest margin is expected to increase further even as the Fed is anticipated to deliver 1% in rate cuts by July 2026.
- I estimate FIBK may reach EPS of $2.85/share in 2026, warranting a Buy rating for the shares given their below-sector 10x forward P/E multiple.
- High concentration in real estate financing, as well as the possibility of continued deposit losses, are key risk to consider.
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