Tue, Oct. 18, 9:41 AM
- The bank reported Q3 net income of $149M or $0.84 per share vs. $136M and $0.74 one year ago. Adding in after-tax restructuring charges of $13M or $0.08 per share brings the bottom line to $0.92 per share, topping estimates by $0.18.
- Comerica's (CMA +2.9%) "GEAR Up" initiative is expected to drive additional annual pretax income of roughly $180M by the end of next year, and now a full $270M by year-end 2018.
- CEO Ralph Babb says the success of GEAR Up means the bank expects to meet or exceed its goal of double-digit ROE, even assuming only a 25-50 basis point increase in interest rates.
- Previously: Comerica beats by $0.18, beats on revenue (Oct. 18)
Tue, Oct. 18, 6:48 AM
Mon, Oct. 17, 5:30 PM
Tue, Oct. 11, 8:07 AM| Tue, Oct. 11, 8:07 AM | 3 Comments
Wed, Sep. 28, 9:32 AM
- "Large banks are going to be forced to take on more capital," says Dick Bove. "It will make the cost of funding more, not less, expensive. It will reduce the appeal for investors to put money at risk in the banking system."
- Bove is commenting on a weekend announcement from Fed Governor Daniel Tarullo promising future stress tests will be geared to demanding even higher cash buffers for banks. Set to take effect next year, the new rule could raise capital requirements for the largest banks by 3 or 4 percentage points, writes Jeff Cox at CNBC.
- Interested parties: BAC, C, WFC, JPM, GS, MS
- There's good news though, as those lenders with less than $250B in assets won't be subject to the same standards. FBR's Edward Mills calls it a "significant positive" for regionals, which now have more certainly on the process, reduced regulatory expenses, and thus the ability to return more capital to owners.
- Interested parties: RF, ZION, CMA, KEY, FITB, STI, NYCB, HBAN, PNC, BBT, MTB
- ETFs: KRE, KBE, IAT, KBWB, QABA, KBWR, KRU, PSCF, KRS, WDRW, DPST
Fri, Sep. 16, 7:12 AM
- Analyst Ryan Nash sees upside to the bank's recently-announced strategic plan to improve pretax earnings by $230M, and expects additional revenue and expense initiatives to be announced during Q3 earnings.
- Management has also said all options are open, meaning M&A is a possibility, which should give downside protection to the stock.
- He upgrades Comerica (NYSE:CMA) to Conviction Buy from Neutral and lifts the price target to $52 from $49. The stock closed yesterday at $46.66.
Tue, Jul. 26, 12:09 PM
Tue, Jul. 19, 1:18 PM
- Q2 net income of $104M of $0.58 per share vs. $135M and $0.73 one year ago. This year's Q2 result includes restructuring charges of $34M or $0.19 per share associated with the initial phase of management's efficiency and revenue initiative ("Gear up"), which is expected to boost pretax income by $230M by year-end 2018.
- As part of "Gear up," the efficiency ratio is expected to decline to the low 60% range by the end of 2017, and be at or below 60% by year-end 2018.
- As for energy loans, the bank set aside just $49M in provisions in Q2, down from $148M in Q1. Energy loans declined 11% in the quarter, but total loans increased 2%.
- CMA +1.8%
- Previously: Comerica beats by $0.08, misses on revenue (July 19)
Tue, Jul. 19, 6:42 AM
Mon, Jul. 18, 5:30 PM
Wed, Jun. 29, 11:08 PM
Wed, Jun. 29, 9:41 AM
- The details aren't available, but one can be pretty sure a common theme through all of the downgrades is a "lower for longer" interest rate scenario, and for any Texas or energy-exposed banks a possible topping in oil prices.
- Comerica (CMA -0.1%) is cut to Underperform from Neutral, Franklin Financial (FSB) to Neutral from Buy, Lincoln National (LNC -0.8%) to Neutral, Principal Financial (PFG +0.5%) to Neutral, Prudential (PRU -0.4%) to Underperform, Regions Financial (RF +0.5%) to Neutral, Synovus (SNV +0.4%) to Neutral, Unum Group (UNM -1.2%) to Underperform, and Zions (ZION -0.3%) to Underperform.
- Previously: Texas Capital downgraded at BAML (June 29)
Thu, Jun. 23, 4:51 PM
- Ally Financial (NYSE:ALLY): Actual end of 2015 CET1 ratio of 9.2%, Q1 2018 CET1 ratio under severely adverse scenario of 6.1%, minimum 6.1%.
- American Express (NYSE:AXP): Actual 12.4%, Q1 2018 12.3%, minimum 11.4%.
- Bank of America (NYSE:BAC): Actual 11.6%, Q1 2018 8.1%, minimum 8.1%.
- BNY Mellon (NYSE:BK): Actual 11.5%, Q1 2018 11.2%; minimum 10.5%.
- BB&T (NYSE:BBT): 10.3%, 6.9%, 6.9%
- BBVA Compass (NYSE:BBVA): 10.7%, 6.5%, 6.5%.
- BMO Financial (NYSE:BMO): 11.9%, 5.9%, 5.9%.
- Capital One (NYSE:COF): 11.1%, 8.2%, 8.2%.
- Citigroup (NYSE:C): 15.3%, 9.2%, 9.2%.
- Citizens Financial (NYSE:CFG): 11.7%, 8.8%, 8.8%.
- Comerica (NYSE:CMA): 10.5%, 8.3%, 8.3%.
- Discover (NYSE:DFS): 13.9%, 12.4%, 11.9%.
- Fifth Third (NASDAQ:FITB): 9.8%, 6.8%, 6.8%.
- Goldman Sachs (NYSE:GS): 13.6%, 10.2%, 8.4%.
- HSBC N.A. (NYSE:HSBC): 15.7%, 9.1%, 9.1%.
- Huntington Bancshares (NASDAQ:HBAN): 9.8%, 5%, 5%.
- JPMorgan (NYSE:JPM): 12%, 8.3%, 8.3%.
- KeyCorp (NYSE:KEY): 10.9%, 6.4%, 6.4%.
- M&T (NYSE:MTB): 11.1%, 6.9%, 6.9%.
- Morgan Stanley (NYSE:MS): 16.4%, 10%, 9.1%.
- Northern Trust (NASDAQ:NTRS): 10.8%, 9.6%, 9.6%.
- PNC Financial (NYSE:PNC): 10.6%, 7.6%, 7.6%.
- Regions (NYSE:RF): 10.9%, 7.3%, 7.3%.
- Santander Holdings (NYSE:SAN): 12%, 11.8%, 11.8%
- State Street (NYSE:STT): 13%, 9.6%, 9.6%
- SunTrust (NYSE:STI): 10%, 7.5%, 7.5%.
- TD Group (NYSE:TD): 13.1%, 8.4%, 8.4%.
- U.S. Bancorp (NYSE:USB): 9.6%, 7.5%, 7.5%.
- Wells Fargo (NYSE:WFC): 11.1%, 7.2%, 7.2%.
- Zions (NASDAQ:ZION): 12.2%, 6.6%, 6.6%.
- Previously: All 33 banks pass this year's stress tests (June 23)
Thu, Jun. 16, 12:29 PM
- Since June 1 when CEO Ralph Babb disclosed preliminary results of a strategic review by Boston Consulting Group, Comerica (NYSE:CMA) 9% decline has outpaced that of its peers.
- Investors were probably hoping for a sale or breakup, but the bank has ruled out a divestiture of one of its three main regional divisions -Texas, California, Michigan - and will instead focus on its Growth in Efficiency and Revenue plan (GEAR).
- Not a fan is Dick Bove who says the options are to sell now at a premium to the current stock price, or go through three years of pain to "bring the company into the 21st century ... Which would you choose?"
- Also hurting is the Fed's dovish turn as Comerica may have mad the most to gain from rate hikes, says Stephens' Terry McEvoy.
- The stock's lower by another 2.7% today.
Mon, Jun. 13, 2:25 PM
- Not very excited about the prospects for bank stocks given the significant flattening in the yield curve as potentially signaling a deteriorating H2 and 2017 environment, a bank stock analyst nevertheless needs to recommend bank stocks.
- Given low expectations as reflected in its cheap valuation, its highly asset-sensitive balance sheet, and the chance for good news from CCAR, Bank of America (BAC -1.3%) is the team's top bank idea.
- Looking at regionals, they like the M&A optionality in Comerica (CMA -1.1%), but don't see much value in names like Citizens Financial Group (CFG -1.1%), Regions Financial (RF -1.1%), SunTrust (STI -0.9%), and Zions Bancorp (ZION -0.9%). Baird also sticks with its Underperform rating on M&T Bank (MTB +0.3%), which trades at 13.5x 2017E EPS vs. about 11x for the peer group.
Wed, Jun. 1, 9:11 AM
- Ahead of this month's release of the stress test and CCAR results, BMO Capital recommends going long Discover (NYSE:DFS) and Morgan Stanley (NYSE:MS), while shorting Comerica (NYSE:CMA) and Fifth Third Bancorp (NASDAQ:FITB).
- A check of the stress test criteria has BMO preferring those lenders with less asset sensitivity, limited exposure to capital markets, limited overseas exposure, low expectations for payout boosts, and high starting capital ratios.
- For those expecting the Fed to surprise with a June rate hike, buy SunTrust (NYSE:STI) against shorts in Comerica and Fifth Third.