If you’ve been tracking first foundation bank stock (ticker: FFWM) lately, you know it’s been a bit of a wild ride. Honestly, it’s one of those regional bank stories that has everything: a massive capital infusion from big-name private equity, a struggle with commercial real estate (CRE) loans, and now, a definitive merger agreement that’s basically going to change the company’s entire identity.
Right now, the stock is hovering around $6.23. To put that in perspective, this is a company that was trading at $28 back in late 2021. It’s been a long fall. But the recent news isn’t about the fall; it's about the pivot. On October 27, 2025, First Foundation and FirstSun Capital Bancorp announced they are merging in an all-stock deal. This isn't just a "business as usual" move. It’s a total strategic reset.
What Really Happened With First Foundation?
To understand where the stock is going, you have to look at how it got here. Like a lot of regional banks, First Foundation got hit hard by the rapid rise in interest rates. They had a lot of multifamily and commercial real estate loans on the books that were suddenly worth less because they were locked into lower rates.
By early 2024, things looked pretty dicey. Then, Fortress Investment Group stepped in.
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They anchored a $225 million equity investment in July 2024 to recapitalize the bank. It was a lifeline. It gave the bank the breathing room to start offloading those risky CRE loans. In fact, by the second quarter of 2025, they had managed to reduce their CRE concentration from a scary 600% of regulatory capital down to about 365%. That’s a huge move, but it wasn't free. They took some massive hits to their earnings to make it happen.
The FirstSun Merger: The Big Pivot
The merger with FirstSun Capital Bancorp is the next—and likely final—chapter for the current iteration of the bank. Here is the deal: First Foundation will merge into FirstSun, and First Foundation Bank will merge into Sunflower Bank.
If you're holding first foundation bank stock right now, you won't be holding it much longer once this closes, which is expected to be in early Q2 2026. Shareholders are set to receive 0.16083 shares of FirstSun common stock for every share of First Foundation they own.
The combined entity is going to be a $17 billion regional powerhouse. The goal here is simple: scale. FirstSun has a strong presence in the Southwest and Midwest, while First Foundation brings that valuable Southern California footprint. Management is projecting some pretty aggressive numbers for the new company, including a return on average assets (ROAA) of 1.45% and a massive 30% boost to earnings per share by 2027.
Why the Market is Hesitant
You might wonder why the stock isn't skyrocketing if the merger looks so good on paper. Well, banking mergers aren't exactly a sure thing in this regulatory environment.
Investors are also looking at the Q3 2025 results. First Foundation reported a net loss of $146.3 million. A lot of that was due to a $65 million provision for credit losses and a $94.7 million valuation allowance on deferred tax assets. Basically, they were cleaning house. They canceled their earnings call for that quarter, which always makes investors a little jumpy.
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Analyst Ratings and What to Expect
Surprisingly, Wall Street isn't totally down on FFWM. As of January 2026, the consensus is actually a "Buy" from several analysts, though it's split.
- Piper Sandler recently upgraded the stock to a Buy with a $6.75 price target.
- DA Davidson has been more cautious, maintaining a Hold with a $6.00 target.
- Stephens also moved to a Buy back in late 2025.
The average price target sits around $6.97. That suggests about 10-12% upside from current levels, but it’s mostly a play on the merger actually going through. If the deal hits a regulatory snag, all bets are off.
The Dividend Situation
If you’re an income investor, don’t get your hopes up. The dividend for first foundation bank stock has been slashed to a penny ($0.01) per share. It’s basically a token amount at this point to keep the "dividend-paying" status alive. Before the turmoil, they were paying $0.11 a quarter.
The focus right now is 100% on capital preservation and the merger. Don't expect a dividend hike anytime soon. The new combined company will have its own dividend policy, but for now, this is a growth and recovery play, not an income play.
The Commercial Real Estate Ghost
The elephant in the room is still CRE. While the bank has done a "Herculean" job (to use the kind of phrase CEOs love) of reducing exposure, they are still working through it. They’ve been selling off loans in chunks. Some sales were favorable; others, like the one in April 2025, actually hurt their pre-tax income by nearly $12 million.
Management’s goal is to be completely out of the "held-for-sale" CRE portfolio by the end of 2025. We'll find out if they hit that goal when they release their Q4 2025 earnings on January 29, 2026.
Actionable Next Steps for Investors
If you are looking at first foundation bank stock right now, you have to decide if you believe in the FirstSun merger. Here is how to approach it:
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- Watch the January 29 Earnings: This is the most critical date on the calendar. Look for the "net interest margin" (NIM). Management guided for 1.8% to 1.9%. If they miss that, the stock could slide.
- Evaluate the Arbitrage: Since this is an all-stock merger, the price of FFWM is now largely tied to FirstSun’s (FSUN) performance. If you think FSUN is undervalued, FFWM is a cheaper way to get a piece of it.
- Check the CRE Runoff: Verify that the "held-for-sale" commercial real estate portfolio is actually gone. If it’s still lingering, it remains a drag on the balance sheet.
- Know Your Timeline: This is not a day-trade. The merger isn't slated to close until at least April or May of 2026. You’re looking at a 4-6 month holding period just to see the new shares in your account.
Regional banks are tricky. They live and die by the local economy and interest rate spreads. First Foundation has survived a near-death experience thanks to Fortress, and now they are looking for safety in a bigger boat. It’s a classic consolidation story in a sector that desperately needs it.