Navient To Benefit From New Trump Administration? Analyst Turns Bullish

Navient Corp NAVI ended the third quarter with an adjusted cash position of $572 million, or $5.35 per share.

That’s adjusted for an unsecured debt maturity and $65 million worth of share repurchases expected in the fourth quarter, according to Seaport Research Partners.

The Navient Analyst: Analyst Bill Ryan upgraded the rating for Navient from Neutral to Buy, while establishing a price target of $18.

The Navient Thesis: The consumer lending segment is valued at 7X of the 2025 estimate for the company, or $12.50 per share, Ryan said in the upgrade note.

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"Given the recent change in administration, prepayment risk in the FFELP (Federal Family Education Loa Program) portfolio has diminished significantly, and the optionality now appears to be in the consumer lending segment," he wrote.

Although Navient does not have significant exposure to the in-school lending channel, "the recent change in administration gives us optimism that parts of the federal student loan program could be outsourced to the private sector to achieve savings in support of tax cuts," the analyst stated, referring to the Trump administration.

The disclosure of overcollateralization releases in the FFELP portfolio could result in additional value, he added.

Price Action: Shares of Navient had risen by 2.95% to $14.33 at the time of publication on Tuesday.

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