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SunTrust upgrades BancorpSouth on small bank acquisition strategy

Upgrades

SunTrust Robinson Humphrey analyst Jennifer Demba upgraded Tupelo, Miss.-based BancorpSouth Bank following the announcement that it agreed to acquire Waco, Texas-based Texas First Bancshares Inc.

The upgrade takes into account BancorpSouth's small bank acquisition strategy, its less asset-sensitive balance sheet and a large mortgage and insurance operation. The analyst noted that BancorpSouth has acquired seven banks since the beginning of 2018.

Demba raised her rating to "buy" from "hold." Her EPS estimates are $2.42 for 2019 and $2.47 for 2020.

Downgrades

Sandler O'Neill analyst Casey Whitman downgraded Richmond, Va.-based Atlantic Union Bankshares Corp. to "hold" from "buy" based on valuation. The shares are up 32% year-to-date versus an 11% rise in the Nasdaq Bank Index.

Whitman lowered the EPS estimate for 2019 by 2 cents to $2.80 and the 2020 estimate by 9 cents to $2.94.

Initiations

B. Riley FBR Inc. analyst Steve Moss initiated coverage of Pittsburgh-based TriState Capital Holdings Inc. citing its growth potential and "unique" business model of private banking, commercial lending and asset management, which should deliver double-digit EPS growth.

"[TriState Capital's] private banking loans are unique in that they are over-collateralized by liquid assets, carry relatively low risk, are lower cost relative to margin loans, and have little competition," Moss wrote. He rated the company "buy."

The price target is $27. GAAP EPS estimates are $1.87 for 2019 and $2.10 for 2020.