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Piper Jaffray downgrades Columbia Banking System; FIG Partners reiterates rating for First Merchants


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Piper Jaffray downgrades Columbia Banking System; FIG Partners reiterates rating for First Merchants


Piper Jaffray analyst Matthew Clark downgraded Tacoma, Wash.-based to "neutral"from "overweight," following first-quarter income results showing moremargin pressure, weaker fees and higher provisioning.

The analyst also lowered his price target to $31 from $33 but noted thatthe company is still a buyer of choice.

According to Clark, Columbia Banking should remain a core holding, and basedon its well-positioned balance sheet, it should become more valuable amid dynamicgrowth in the Pacific Northwest. He lowered his EPS estimatefor 2016 to $1.74 from $1.93 and for 2017 to $1.87 from $2.01.

SunTrust Robinson Humphrey analyst Michael Young downgraded Houston-basedGreen Bancorp Inc. to"neutral" from "buy," citing the company's shift from a potentialseller to a potential buyer. The switch limits the near-term valuation upside, accordingto the analyst.

The downgrade is also in connection with the company's to liquidate energy loans portfolioand various assets, which will "likely accelerate the loan losses, offset loangrowth and meaningfully limit the TBV accretion over the next 12 to 24 months,"Young wrote.

Young lowered his price target to $9 from $10. His 2016and 2017 EPS estimates are 28 cents, down from 84 cents, and 78 cents, down from$1.07, respectively.

Notable reiteration

At FIG Partners, analyst Brian Martin reiterated his "market perform"rating for Muncie, Ind.-based FirstMerchants Corp. and raised his price target to $27 from $25.50.He increased his core EPS estimate for 2016 by 3 cents to $1.90 and kept his 2017EPS estimate the same at $2.01.

Martin wrote, "We continue to be believe a peer like multiple or slightlybetter is justified given the company's healthy profitability, solid/consistentgrowth trends, strong credit quality and asset sensitivity."

The analyst said the company is a good core holding for small-cap investorsbecause of its strategy for organic growth and M&A. He noted that the companyis in a position to consider anothertransaction.

The analyst predicts steady development in the company's net interest incomefor the rest of the year due to its solid first-quarter and loan growth.