How to value opportunity is a question with no easy answer, but it’s a relevant question to ask when it comes to Byline Bancorp (NYSE:BY). This Chicago-based business lender has an attractive market opportunity lending to small and medium-sized businesses in the third-largest metro area in the country, not to mention taking share in what is still a very fragmented market. What’s more than fragmented market creates acquisition value for Byline, as well as M&A growth opportunity within the market.
So, the question is how much credit to give to M&A growth potential and/or how much of an M&A backstop to build in here. On its own, if Byline hits my core earnings growth targets, the shares aren’t all that attractive today, but I would be surprised to be looking at this bank again in a couple of years and not see either meaningful M&A to grow the bank or an acquisition of the bank.
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Byline Bancorp: Attractive Opportunities, But Not Such An Attractive Valuation
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