Comerica (NYSE:CMA) is expected to report Q2 earnings before the market open on Tuesday, July 21 with a conference call scheduled for 8:00 am.
Firms have had widely different outlooks on Comerica (CMA) over the last several weeks. Comerica was recently initiated with a Neutral rating by FTN Equity, but Bank of America/Merrill recently reinstated the stock with a Buy rating. On July 1, Fitch Ratings downgraded Comerica's credit rating to B/C from B. Fitch believes that Comerica may have difficulty making a profit in 2009 due to its higher credit costs and depressed net interest margin. The ratings agency also believes that a deteriorating of the economy could hurt the bank's commercial book and its overall performance.
Last month, JP Morgan upgraded Comerica to Overweight from Neutral. The firm predicted that the bankruptcy of GM (NYSE:GM) would cause the Michigan economy, to which Comerica has a very large exposure, to bottom sooner. The firm set a $27 target on the stock. Also last month, a Soleil analyst initiated Comerica with a Buy rating. The firm believed the bank's stock could advance thanks to its "strong" capital position and long-term earnings power. The firm set a $28.50 target on the stock. However, S&P last month lowered the ratings of Comerica and 21 other banks as the ratings agency predicts that operating conditions for the banking industry will become less favorable than in the past. Specifically, S&P expects banks to be burdened by greater volatility in financial markets during credit cycles and tighter regulatory supervision.