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Compass Point rates CapStar 'sell' on valuation

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Compass Point rates CapStar 'sell' on valuation


* Compass Point's Laurie Havener Hunsicker downgraded the stock ratings of CapStar Financial Holdings Inc. and Independent Bank Corp. on valuation.

The analyst lowered Nashville, Tenn.-based CapStar's rating to "sell" from "neutral," reiterating its $17 price target. Hunsicker calculates the stock has returned 14.4% in the last three months, compared with the SNL Bank & Thrift Index's 4.3%, and attributed it primarily to Gaylon Lawrence Jr.'s increase in stake.

Hunsicker noted CapStar's chairman, Dennis Bottorff, has overseen the sale of three other banks. A CapStar sale could mean an upside of 2% to 15% from current levels, according to the analyst.

Rockland, Mass.-based Independent, meanwhile, has returned 14% over the last three months. Hunsicker lowered the rating to "neutral" from "buy," but raised the price target by $4 to $76.


* Hovde Group now covers Commerce Union Bancshares Inc. Joseph Fenech rated the stock "outperform" and gave it a $26.50 price target.

Describing the Brentwood, Tenn.-based company as "a thoughtfully-constructed franchise with significant scarcity value," the analyst thinks EPS could hit $1.04 for 2017, $1.24 for 2018 and $1.45 for 2019. Fenech also commented on the "strong management team" with its roughly 13% ownership and on Commerce Union's home county's job growth rate — the highest in the U.S. in 2016.