Piper Jaffrayanalyst Peyton Green upgraded his rating for Nashville, Tenn.-based to "overweight"from "neutral," and increased the price target for the company's stockto $60.00 from $51.00. He also upped his EPS estimates to $3.57 from $3.40 for 2017and to $4.05 from $3.85 for 2018. The EPS estimate for 2016 is $3.02, up 2 cents.
The changesreflect a number of factors, including the company's acquisition of Avenue Financial.The analyst wrote that the integration of Avenue is "off to a very good start"and noted that Avenue's growth prior to merger closing outpaced that of Pinnacle's.
Another factorwas the company's continued strong hiring activity in the second quarter, whichGreen said warrants an increase in organic asset growth to 14% as opposed to theprevious estimate of 12% to 13% for 2017 to 2018.
Green also wrotethat he expects Pinnacle's market share mining to pick up speed in Nashville, Chattanooga,Knoxville and Memphis from the second half of 2016 through the whole of 2017, especiallygiven the company's faster momentum in recruiting well known, experienced middle-marketcommercial bankers, particularly those from Atlanta-based SunTrust Banks Inc.
Analyst WilliamWallace IV of Raymond James initiated coverage of Raleigh, N.C.-based with a ratingof "strong buy" and a price target of $41.00. He set his EPS estimatesat $2.54 for 2016 and $2.75 for 2017, and GAAP EPS estimates at $2.55 for 2016 and$2.75 for 2017.
In his July11 report, the analyst also assigned the company a high risk/growth suitabilityrating, due to Paragon Commercial's growth-oriented profile and highly competitivemarkets. He also noted that the company has managed to overcome challenges broughtabout by asset quality issues and heavy reliance on brokered deposits for funding.He wrote that the company is now expected to continue exhibiting above-peer profitability.
Furthermore,Wallace stated that he sees the company's efficiency ratio falling to 50% by thefourth quarter of 2017, compared to the 61% for the first quarter of 2016.
He added thathe does not feel that the company's 376% commercial real estate concentration —as opposed to the 300% regulatory guidance — is a risk, given the three-year commercialreal estate growth of just 12%, which is below the 50% regulatory guidance.
FIG Partnersanalyst Timothy Coffey dropped coverage of WilshireBancorp Inc. and Los Angeles-based 1st Century Bancshares Inc. in two separate July 11 reports.
For Wilshire,the final rating was "market-perform" with an $11.60 price target. Thedropping follows the regulatory approvalof its deal withLos Angeles-based peer BBCN BancorpInc.
For 1st CenturyBancshares, the dropping follows the completionof the company's acquisitionby Oklahoma City-based Midland FinancialCo.. The final rating for the company was "market-perform"with a price target of $11.22.