Zions Bancorp (ZION) Stock Forecast & Price Target

Zions Bancorp is positioned favorably because management expects 100 to 150bp of positive operating leverage in 2026 while keeping expenses only moderately higher, supported by improving revenue investments, stronger fee income, and an asset-sensitive balance sheet that could benefit from even one rate hike. Credit quality is a clear strength, with provision expense of $3M in 2Q26, net charge-offs of just 6bp of average loans, an ACL ratio of 1.16% that covers nonperforming loans 2.4x, and criticized loans continuing to decline. Capital is also building, as CET1 rose to 11.6%, TBV increased 7.2% Q/Q to $44.74, AOCI losses are expected to narrow, and share repurchases resumed, giving the bank more flexibility to compound value.

Zions Bancorp is likely to face a challenged fundamental backdrop because its earnings are still highly exposed to net interest margin pressure from intense competition for loans and deposits, with 2Q26 NIM flat at 3.27% and funding costs edging higher as more growth shifts into interest-bearing deposits and short-term borrowings. While management expects moderately increasing loans and fee income, the mix is not fully benign because consumer loans are expected to contract as resi mortgage production is sold, core expenses remain guided to “moderately increasing,” and the low TCE ratio leaves limited balance-sheet cushion if regulators focus more on that metric. Credit trends are currently solid, but rising nonperforming assets, $2.327 billion of classified loans, and exposure to CRE, shared national credits, and energy lending support a cautious outlook.