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A small bank based in West Virginia has positioned itself as a key figure in the online betting world, and that first-mover advantage should have staying power, according to JPMorgan. Analyst Steven Alexopoulos reiterated his overweight rating on MVB Financial , saying in a note to clients that the bank has proven itself to be a key partner for casinos and sportsbooks. “We find that the MVB team has been forming an ecosystem around the bank over the past five years serving the online gaming industry (which was legalized at the federal level in 2018). It was very clear to us that MVBs clients in the gaming industry value that MVB was committed to serving the industry from early on when other banks were either not interested or did not have specialized expertise to step in,” the note said. MVB is a small bank, with about $3.6 billion in assets and a market cap of about $259 million. But the company’s proactive moves in the gaming space should help it fend off competitors, according to JPMorgan. “As MVB deepens its moat by building fintechs via Edge Ventures and invests in startup companies, the company has a front row seat into how to best serve their niche clients and make them an invaluable partner in the industry,” the note said. MVB Edge Ventures is a subsidiary of the bank, and it provides management oversight for the firm’s tech investments. JPMorgan first initiated coverage of MVB with an overweight rating on Feb. 27 , before the failure of Silicon Valley Bank. Since Feb. 24 — the trading session before JPMorgan announced it was covering the stock — shares of MVB have fallen more than 18%, but that’s still a better performance than the nearly 30% decline for the SPDR S & P Regional Banking ETF (KRE) . MVB saw total deposits rise during the first quarter while many other regional banks saw outflows. MVBF YTD mountain Shares of MVB Financial have performed better than many other regional bank stocks in 2023. JPMorgan has a price target of $24 per share for MVB, about 18% above where the stock closed Friday. The target was $35 per share in February. — CNBC’s Michael Bloom contributed to this report.
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