Popular (BPOP) Stock Forecast & Price Target

Popular is supported by a powerful combination of earnings momentum, capital strength, and favorable Puerto Rico fundamentals, with 2Q26 core EPS of $4.35 well above estimates and PPNR rising 6.0% to $390 million. Its NII and fee outlook improved meaningfully, driven by a 4.17% FTE NIM, deposit growth to $70.2 billion, and strong franchise activity, while credit quality remains resilient with negligible NCOs in Popular U.S. and no sign of structural deterioration in the portfolio. The company’s 16.1% CET1 ratio, $1.0 billion buyback authorization, and 20% dividend increase give it substantial flexibility to return capital, while the Commonwealth’s stronger fiscal position and ongoing securities repricing should continue to support profitability.

Popular is facing a negative fundamental setup because its results remain heavily exposed to Puerto Rico’s weak macro backdrop, shrinking tax base, outmigration, and limited credit-market access, all of which can restrain loan growth and revenue opportunities. Credit quality is also a concern, as commercial NPL inflows rose on two borrower-specific loans totaling $129 million, while the provision for credit losses was still elevated at $66 million and could rise further if inflation, policy uncertainty, or a recession in 2027 weaken repayment behavior. At the same time, a potentially smaller balance sheet in 3Q26E, higher noninterest expense of $484 million, and only $7 million of noninterest income point to limited earnings leverage and pressure on profitability.