Two out of the seven official analysts covering Zions Bancorporation (ZION) have updated their ratings and twelve month target prices within the past several days.
Sorted by date, this is how it now stands, including CrossProfit as the eighth (unofficial) analyst:
Zion closed Thursday (6/12/08) at $35.82, beaten down with the rest of the financial and banking sectors. Trailing twelve months (ttm) P/E is now below 9 and forward P/E below 14. This is after taking into account reduced earnings estimates averaging 10%.
It is reassuring to know that while non performing assets rose by 53% and charge offs doubled in Q1, the base is so small that they would have to quadruple from here in order to be of concern. To spell it out, ZION is expected to post earnings per share for FY2008 of over $3.50 - that's profit per share, not loss per share - and over $4.50 for FY2009.
Just in case you were wondering, ZION is not a subprime smarty pants bank. There is some talk by Stifel Nicholas that ZION will issue $250M in preferred just to satisfy the talking heads in Washington that want higher capital ratios.
What is amusing is that ZION is the only bank that we know of sporting a table as above. As the stock price goes down over time, the more recent ratings and target prices seem to improve! Does this mean that if the PPS drops another $10 then we get a new higher target price at $66? Just asking…
Disclosure: No conflicts.