First Horizon Corporation (NYSE:FHN) has reported a significant decrease in short interest, with figures dropping by 40.1% from 15,155,429 shares on December 15 to 9,071,624 shares as of December 31, 2023. This decline indicates that approximately 1.9% of the company’s stock is currently sold short. The average trading volume stands at 5,240,291 shares, resulting in a days-to-cover ratio of 1.7 days.
Investors are closely monitoring First Horizon’s stock performance, particularly its recent trading activity. On Friday, shares traded down by $0.34, closing at $24.10 with a trading volume of 11,606,210 shares, surpassing the average volume. The company maintains a debt-to-equity ratio of 0.15, with a current ratio of 0.96 and a quick ratio of 0.95. Over the past year, the stock has fluctuated between a low of $15.19 and a high of $24.91.
Stock Buyback and Dividend Announcement
In a move signaling confidence in its valuation, First Horizon’s Board of Directors authorized a stock buyback plan on October 27, 2023. This plan permits the purchase of up to $1.20 billion in shares, allowing the company to reacquire 11.3% of its outstanding stock through open market transactions. Such buyback programs generally reflect management’s belief that the company’s shares are undervalued.
Additionally, First Horizon announced a quarterly dividend of $0.15 per share, which was distributed on January 2, 2024, to shareholders recorded as of December 12, 2023. This dividend represents an annualized total of $0.60, yielding 2.5% based on current share prices. The company’s dividend payout ratio stands at 31.91%.
Insider Transactions and Institutional Investment
Recent insider transactions have also drawn attention. Chief Accounting Officer Jeff L. Fleming sold 7,619 shares on November 12, 2023, at an average price of $21.74, totaling approximately $165,637.06. Following this transaction, Fleming holds 128,626 shares valued at around $2,796,329.24, indicating a 5.59% decrease in his ownership.
Executive Vice President David T. Popwell also sold 155,149 shares on November 4, 2023, for about $3,306,225.19, reducing his ownership by 33.54% to 307,432 shares valued at approximately $6,551,375.92. Currently, insiders own 0.87% of the company’s stock.
Hedge funds have shown increased interest in First Horizon. Voya Investment Management LLC raised its stake by 301.4% in the third quarter, acquiring an additional 172,599 shares, bringing its total holdings to 229,860 shares worth $5,197,000. Other institutional investors, including Northwestern Mutual Wealth Management Co. and Invesco Ltd., have also expanded their positions, highlighting a trend of growing institutional confidence, with hedge funds and institutional investors owning 80.28% of the company.
As analysts evaluate First Horizon’s performance, several brokerage firms have revised their price targets. Evercore ISI maintained an “in-line” rating but lowered its target from $26.00 to $20.00. Conversely, UBS Group reaffirmed a “buy” rating with a target of $28.00. Overall, the consensus among analysts presents nine buy ratings and twelve hold ratings, with an average target price of $26.58.
Company Overview
Headquartered in Memphis, Tennessee, First Horizon Corporation is a diversified financial services provider. The company offers a range of solutions, including retail and commercial banking, mortgage services, and wealth management. With a strong presence across the Southeastern United States, First Horizon has established itself as the largest bank-based financial services firm in Tennessee, evolving from its origins in the First National Bank of Memphis, founded in 1864.
As First Horizon navigates through the changing financial landscape, its strategic decisions and market performance will continue to attract the attention of investors and analysts alike.
