** Hovde Group upgrades rating on shares of regional lender TowneBank TOWN.O to "outperform" from "market perform" following announcement of a $203 million deal for rival Old Point Financial OPOF.O
** The deal will expand TOWN's presence in Hampton Roads and boost the bank's 2026 EPS by about 10%
** TOWN's risk-averse lending profile, combined with its growing footprint within Hampton Roads, positions the bank well to navigate an uncertain economic environment - Hovde Group
** Brokerage expects Hampton Roads area to benefit from increasing military spending over time
** Hovde cuts PT on TowneBank by $1 to $38, despite increase in EPS expectations, to account for uncertain economic backdrop that is currently weighing on the banking sector
** Two of four brokerages rate the stock "buy" or higher and two "hold"; median PT is $39.50 - data compiled by LSEG
** As of last close, TOWN shares down 9.4% YTD
(Reporting by Arasu Kannagi Basil in Bengaluru)
((ArasuKannagi.Basil@thomsonreuters.com;))
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