New Conviction for a Fintech Enabler: Raymond James Issues Strong Buy for The Bancorp

The Bancorp, Inc. (TBBK) is a specialized financial services provider with a tech-forward approach, serving as a backbone for fintech, payments, and private label banking programs. Its unique model—focusing on providing banking-as-a-service (BaaS) infrastructure to non-bank fintech partners—has propelled its growth and made it a critical, if sometimes overlooked, player in the evolving financial ecosystem. Today, Raymond James, a heavyweight in investment research and capital markets, has upgraded TBBK to “Strong Buy” with a $76 price target, underscoring conviction in the company’s earnings trajectory and sector leadership. This rating is a significant step up from their prior "Outperform," and signals escalating institutional confidence in the company’s outlook at a pivotal moment for digital finance.

Analyst upgrades—especially when they come from established, influential research desks—often precede significant price action, reflecting new institutional consensus or a catalyst that could reset market expectations. For investors seeking the next wave of fintech winners, Raymond James’ call on The Bancorp deserves a closer look.

Key Takeaways

• Potential Upside: Raymond James’ $76 price target represents a potential 17% upside from current levels.

• Stock Strength: TBBK shares have rallied over 3% today, extending a strong multi-month trend—up from a 52-week low of $40.51 to recent highs above $70.

• Catalyst Events: Recent credit rating upgrades from KBRA and a new profit target from management have improved sentiment and visibility.

• Technical Backdrop: While the stock’s RSI sits near 36 (suggesting it’s not overbought), its 20-day EMA and SMA indicate continued bullish momentum, supported by robust trading volumes.

• Analyst Firm Weight: Raymond James is a leading mid- to large-cap research house, with deep sector expertise and a history of prescient calls in financial services.

Raymond James Upgrade: A Signal Worth Decoding

Why the "Strong Buy"? Analyst Conviction and Firmhood

Raymond James, known for its rigorous due diligence and deep bench in financial sector research, has elevated TBBK to a "Strong Buy"—their highest conviction rating. This move reflects not only a positive view on The Bancorp’s earnings power and niche dominance, but also signals a recalibration in risk/reward, as the company consolidates its leadership in fintech enablement. The $76 target is a notable premium to today’s price, and the shift from "Outperform" to "Strong Buy" suggests Raymond James sees a step-function change in the bank’s growth prospects or risk profile.

Analyst Confidence: "Raymond James’ upgrade aligns closely with recent financial strength and sector trends, underscoring institutional conviction." Deepstreet

Not all upgrades are created equal. Raymond James, with its formidable reputation and broad institutional clientele, tends to move the needle for mid-cap financial stocks—often attracting incremental buy-side attention. Their upgrade for TBBK stands out in the current market, where many analysts are still cautious on regional banks and fintech partners given recent macro and regulatory volatility.

Business Model in Focus: The Bancorp as a Fintech Enabler

The Bancorp operates a differentiated platform, providing back-end banking infrastructure (including FDIC-insured deposits, payment processing, and compliance services) to a roster of fast-growing fintechs, neobanks, and payment providers. Unlike traditional banks, it does not rely on a branch network, focusing instead on high-volume, high-margin niche programs—think prepaid cards, health savings accounts, and white-label lending.

This BaaS (banking-as-a-service) model is capital-light, scalable, and increasingly sought after by digital-first brands seeking to embed banking products into their offerings. The Bancorp’s deep compliance expertise and regulatory relationships have helped it win partnerships that larger, slower-moving banks can’t match.

Financial Performance: Momentum and Resilience

The Bancorp’s recent financials point to a company hitting its stride:

• Revenue and Earnings: The company’s Q2 2025 results (per Seeking Alpha) highlighted above-consensus EPS, continued net interest margin expansion, and robust fee income from payments programs. Management also issued a new, higher profit target, reinforcing visibility for the back half of 2025.

• Balance Sheet Strength: Recent upgrades by the Kroll Bond Rating Agency (KBRA), which moved The Bancorp’s senior unsecured debt from BBB to BBB+, further validate the company’s improved credit profile and prudent risk management.

• Market Share: The Bancorp’s dominance in private label card programs and payment solutions has created a durable competitive moat, even as larger regional banks have struggled to adapt to regulatory shifts.

Stock Price Action: Riding a Breakout Trend

Over the past year, TBBK stock has staged a powerful run:

• Price Range: Shares have surged from a 52-week low of $40.51 (April 2025) to recent highs of $70.63 (July 2025), reflecting growing investor appetite for fintech enablers and digital banking plays.

• Recent Technicals: With a 20-day EMA of $63.76 and 20-day SMA of $65.64, the stock is trending strongly above key support. The RSI at 36 suggests there’s room for further upside before overbought conditions set in.

• Volume and Sentiment: Trading activity remains robust, with average daily volume above 57,000 shares and a sentiment ratio slightly favoring up days (124 up vs. 122 down over the past year), indicating steady accumulation.

Recent News: Credit Upgrades and Strategic Shifts

Recent headlines have added fuel to the TBBK story:

• KBRA Credit Upgrade: On August 4, 2025, KBRA upgraded The Bancorp’s senior unsecured and subordinated debt ratings, citing “improved asset quality, earnings durability, and balance sheet management.” This has enhanced investor confidence, particularly among institutional buyers sensitive to credit risk.

• Earnings Reset: Following a strong Q2 print, management outlined a higher profit target for 2025, signaling that operational leverage and new fintech partner wins are translating into tangible bottom-line growth.

• Resilient After Volatility: After an earnings-induced dip earlier this year, the company “dusted itself off” and quickly regained momentum, as noted in a recent Investors Business Daily feature.

Potential Upside: What $76 Implies

Raymond James’ $76 target implies a 17% upside from the current price of $64.81. For a financial services stock with a steady track record and new credit rating tailwinds, this is a meaningful premium—especially as many regional peers still trade below pre-2022 highs.

• Risk/Reward: The upgrade suggests that risks (regulatory, competitive, credit) are now better understood and managed, with the growth opportunity from new fintech partnerships outweighing near-term headwinds.

• Catalysts to Watch: Upcoming partner launches, potential M&A in the BaaS space, and continued upward revisions to earnings estimates could all support further gains.

Conclusion: A Rare Opportunity in Fintech Infrastructure

Raymond James’ “Strong Buy” on The Bancorp is more than just an optimistic call—it’s a signal that institutional investors are re-rating the stock’s growth and risk profile amid a broader fintech transformation. With a compelling 17% upside, improving financials, and new credit rating validation, TBBK stands out as a high-conviction play for those seeking exposure to the digital backbone of tomorrow’s financial services.

Investors should monitor further analyst commentary, partner announcements, and technical signals as the stock approaches new highs. For now, Raymond James’ upgrade puts The Bancorp firmly on the radar of serious market participants looking for outsized returns in the financial sector’s next act.