R. Scott Siefers from Sandler O'Neill & Partners upgraded Cincinnati-based Fifth Third Bancorp's stock rating to "buy" from "hold," following the completion of its acquisition of Chicago-based MB Financial Inc.
According to the analyst, the deal improves Fifth Third's franchise value and provides company-specific profitability enhancement opportunities for the future.
The analyst wrote that Fifth Third's loan growth trajectory is improving over previous periods and that the company is in a position to sustain momentum. Additionally, previous concerns about the MB Financial deal have already been priced into the stock, and with the transaction's close, its financial benefits are still "on the come," presenting an attractive opportunity, Siefers said.
The analyst changed his 2019 EPS estimate for Fifth Third to $2.67 from $2.75 and his 2020 EPS estimate to $3.11 from $3.02.
Joseph Fenech from Hovde Group initiated coverage of Eau Claire, Wis.-based Citizens Community Bancorp Inc. at "outperform" with a price target of $14.
Fenech wrote that the company has a commanding presence in Eau Claire, ranking second on a pro forma basis, with just over 13% deposit share.
He also wrote that the company has transformed its franchise and business model in recent years and that M&A has been a prominent factor in the strategy to transition the business model.
Fenech thinks that Citizens' management will continue to pursue acquisitions. According to him, the "target markets include northwestern, western, and north central Wisconsin; areas in or in close proximity to micropolitan or metropolitan markets in Minnesota; and northern Iowa."
The analyst's EPS estimates for Citizens are $1.18 for 2019 and $1.30 for 2020.