First Bank (FRBA) Stock Forecast & Price Target

First Bank is viewed positively because the credit issues appear isolated to a small business portfolio of less than $100M, while management expects further charge-offs to moderate and believes most losses are already reserved for. Even after elevated net charge-offs of about 60 bps and a 20 bps rise in nonperforming assets to 0.66%, the bank still has a healthy 1.39% total allowance and management points to strong LTV/DSCR protection. The outlook is further supported by capital flexibility, as the remaining $20M buyback authorization could reduce shares by about 5% while still leaving a strong 12.5% TRBC.

First Bank is facing a challenging fundamental setup because 1Q26 results broadly missed expectations, with EPS pressured by an elevated provision tied to losses in small business lending, higher compensation costs, and weaker-than-expected net interest income. Credit quality has deteriorated, with higher net charge-offs in the micro/small business segment and expectations for roughly $3 million of quarterly provisioning through 2027, while the net interest margin fell 5 bps to 3.69% amid deposit pricing pressure. Although loan growth momentum is improving and management still targets $200 million of full-year growth, the company’s work-in-progress deposit franchise, elevated CRE concentration, and potential NIM compression if rates fall in 2H26 support a cautious outlook.