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Stephens upgrades Fidelity Southern to 'overweight'

Upgrade

Stephens Inc. analyst Tyler Stafford raised Atlanta-based Fidelity Southern Corp.'s stock rating to "overweight" from "equal-weight" and increased the price target to $31 from $25.

Stafford wrote: "In an environment where core deposits are king, inflecting profitability is rare, quality and scale in attractive markets is paramount, and trough valuations are hard to find." Fidelity Southern is the "best representation" of these parameters, wrote the analyst.

Stafford adjusted Fidelity Southern's operating EPS estimates to $1.46 from $1.49 for 2018, and to $1.60 from $1.57 for 2019.

Downgrade

David Konrad of Macquarie Research lowered Dallas-based Comerica Inc.'s stock rating to "neutral" from "outperform."

Konrad attributed the downgrade to decreasing London Interbank Offered Rate spreads that are hindering margin improvement. The analyst further wrote that they "are cautious heading into September with concerns regarding disappointing guidance relative to [second-half] expectations."

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Konrad also downgraded his rating on San Francisco-based Wells Fargo & Co.'s stock to "neutral" from "outperform" based on valuation and near-term estimates falling below consensus.

Wells Fargo's stock has risen in value after two meaningful catalysts: favorable expense guidance in May and strong June Comprehensive Capital Analysis and Review results.

Initiations

Piper Jaffray & Co.'s Matthew Breese is now covering New York-based Amalgamated Bank's stock. He gave it a "neutral" rating and set the price target at $19.50.

The analyst wrote that Amalgamated Bank, through a relationship-driven, values-based approach, attracts noninterest-bearing deposits from a number of nonprofit, labor and union organizations, helping to drive a 46% noninterest-bearing deposits and about an 80% loan-to-deposit ratio.

Regarding M&A, the analyst wrote that Amalgamated Bank, following its acquisition of New Resource Bancorp, "remains on the hunt for deals," and is targeting socially aware banks in areas such as Boston, Chicago, Los Angeles and Seattle.

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William Wallace IV of Raymond James also initiated coverage of Amalgamated Bank's stock. He gave it an "outperform" rating and set the price target at $20.

Wallace wrote that given Amalgamated Bank's recent entry into San Francisco with the acquisition of New Resource Bancorp, combined with evident success by way of de novo expansion in Washington, D.C., its management will pursue an organic growth strategy in its high-growth footprint, augmented by additional M&A in constituencies such as Chicago, Boston and Seattle in the coming years.