ONB Stock Forecast & Price Target

Old National Bancorp has demonstrated solid financial performance, with core deposit balances increasing by 0.8% and a reported net interest margin improving to 3.53%, reflecting a 26 basis point sequential increase. The bank achieved a remarkable 32.8% sequential growth in net interest income, reaching $514.8 million, and saw core fee income rise to approximately $112 million, indicative of strong operational efficiency. Additionally, the total loan pipeline surged to $4.8 billion, driven primarily by increased commercial balances, signaling robust growth potential for the company's future prospects.

Old National Bancorp faces several significant risks that contribute to a negative outlook, including the potential for deteriorating asset quality, which could adversely affect earnings, capital, and growth prospects. The company's Common Equity Tier 1 (CET1) ratio has declined by 88 basis points to 10.74%, indicating increasing financial strain. Additionally, challenges in managing net interest margins and delivering expected merger benefits further exacerbate the uncertainties surrounding the company's economic performance in its core Midwestern markets.