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PiperJaffray upgrades Wells Fargo

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* PiperJaffray analyst Kevin Barker upgraded Wells Fargo & Co. to "neutral" from "underweight."

Barker wrote that the financial setback the company is experiencing from its accounts scandal has been "embedded" in the Street's estimates, thus driving the upgrade. He added that the Street's estimates for Wells, which have dropped in fiscal year 2017, are healthy for the stock because they better represent the financial situation of the company. Wells' stock is now trading in line with a slight discount compared to its peers, Barker wrote.

The analyst still expects the company to have slower earnings growth compared to its peers. But he projected a more sustainable EPS during volatile times versus its peers because of the company's diverse businesses and strong deposit base.

Barker increased the company's price target to $55 from $52.

Notable reiterations

* Sandler O'Neill & Partners analyst R. Scott Siefers reiterated his "hold" rating for Wells Fargo & Co. after the company's board released the findings of its independent investigation in connection with the bank's sales scandal.

One of the main causes of the sales scandal is the "cultural distortion in community banks and [Wells Fargo's] decentralized structure," Siefers wrote.

The analyst noted that while the board was critical of the company's previous management, sales culture and structure, the report had no "new bombshells" that would open new issues. Siefers wrote that he does not see any specific catalyst to drive shares to outperform, given the massive damage caused by the scandal.

The analyst maintained his price target at $59.

* Sandler O'Neill analyst Tim O'Brien reiterated his "buy" rating for Los Angeles-based CU Bancorp, following the announcement of its pending deal with Beverly Hills, Calif.-based PacWest Bancorp. He also increased his price target to $44 from $43.

O'Brien wrote that the cash-and-stock deal, which is valued at $705 million, or $39.45 per share, would mutually benefit the companies because of the similarities in their cultures, client bases, funding sources and markets.

Furthermore, the analyst noted that the deal price, at 284% of tangible book value and 23x his 2017 EPS estimate, is a "compelling value" for CU Bancorp shareholders. The deal price also comes with an 18% core deposit premium, the analyst wrote.

CU Bancorp offers a strong core deposit base, a valuable book of small- and medium-sized business clients, strong credit quality, and a high degree of asset sensitivity, O'Brien wrote.