Benchmark has revised its assessment of digital banking institution First Internet Bancorp, raising the price target from $33 to $35 per share while reaffirming a "buy" recommendation.

The updated valuation is based on seven times the firm's projected earnings per share for the 2027 fiscal year, equating to roughly 0.75 times the estimated tangible book value.

This price target increase follows First Internet Bancorp's release of its second-quarter 2026 financial results. The company reported net income of $2.4 million, or diluted earnings per share of $0.27, a substantial jump from $0.02 in the same period last year. Total revenue increased by 23% year-over-year to $41.1 million.

Improved performance was driven by a 16% rise in net interest income, a 56% surge in non-interest income from its banking-as-a-service platform, and significantly enhanced credit quality. The provision for credit losses decreased to $13.4 million from $16.3 million in the first quarter, and non-performing loans declined for the second consecutive quarter.

Benchmark initiated coverage on the stock on June 24 with a "buy" rating and a $33 price target, believing that market concerns over potential capital raising were already reflected in the share price and that such financing would not be necessary.

Analysts suggest there is further upside potential if credit quality continues to improve and the net interest margin expands. The company's fully taxable equivalent net interest margin currently stands at approximately 2.47%, which represents a 43-basis-point expansion compared to the same period last year.

Founded 25 years ago, First Internet Bancorp was the first state-chartered, FDIC-insured online-only bank in the United States, headquartered in Fishers, Indiana.

The company has issued full-year guidance, projecting earnings per share in the range of $2.35 to $2.45 and expects its net interest margin to reach between 2.75% and 2.80% by the fourth quarter.