Wed, Feb. 3, 10:25 AM
- This just in: The financial sector is having a worse go it this year than energy, with the XLF lower by 13.6% YTD vs. the XLE's 9% decline.
- Leading a big reversal from this morning higher open is the XLF's 2% decline. The S&P 500 is now off 1%, and the XLE "just" 0.85%.
- Among the issues for the financials are two items: 1) Hopes for a sustained rate hike cycle have been dashed, with the 10-year yield tumbling all the way to 1.82% currently from about 2.30% when the Fed hiked in mid-December. Fed speakers are all-of-a-sudden sounding very dovish (Dudley is the latest), and short-term rate futures are now pricing in just a 50% chance of even one Fed rate increase this year; 2) For lenders specifically, there's worry over their exposure to the crashing energy sector. No doubt better capitalized today than 10 years ago, losses are still losses even if they don't threaten the viability of the bank.
- JPMorgan (JPM -2.6%), Wells Fargo (WFC -3.6%), Morgan Stanley (MS -3.5%), KeyCorp (KEY -3.1%), PNC Financial (PNC -2%), Comerica (CMA -2.7%), Schwab (SCHW -3.8%), MetLife (MET -2.5%)
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, IAT, SEF, IYG, FXO, FNCL, KBWB, FINU, QABA, KRU, KBWR, RWW, RYF, PSCF, FINZ, KRS, XLFS
Thu, Jan. 28, 9:40 AM
- Nice post-earnings bounces continue for Comerica (CMA +3.3%) and Prosperity Bancshares (PB +4.5%) as oil soars above $34 per barrel on chatter of production cuts.
- Also at work, BMO Capital pulls its Underperform rating on Comerica, and Evercore pulls its Sell rating on Prosperity. Alongside that is DA Davidson upgrading Prosperity to Buy from Neutral.
- Previously: Comerica beats by $0.02, beats on revenue (Jan. 19)
- Previously: Prosperity Bancshares launches buyback (Jan. 27)
- Previously: Prosperity Bancshares beats by $0.01, misses on revenue (Jan. 27)
- Other energy-exposed lenders: Cullen/Front (CFR +3.9%), Texas Capital (TCBI +2.5%), Independent Bank Group (IBTX +11.6%), Zions Bancorp (ZION +2.8%)
Dec. 15, 2015, 12:40 PM
- The S&P 500 (SPY +1.5%) is at its session high alongside oil (NYSEARCA:USO), which is up 3.3% on the session and nearly 10% since falling to almost $34 per barrel roughly 24 hours ago.
- Energy (XLE +2.7%) is the best-performing sector in the S&P 500, but financials (XLF +2.5%) aren't far behind, with energy-exposed names like Comerica (CMA +5.2%), ZIons Bancorp (ZION +3.8%), and Prosperity Bancshares (PB +2.7%) among the regional bank movers.
- The surge has also given a big lift to junk bond prices even as the 10-year Treasury yield jumps five basis points to 2.27%. TLT -0.7%, TBT +1.4%.
Dec. 8, 2015, 1:35 PM
- The selloff in financial names is a broad one, but those seen as especially reliant on energy deals and lending are suffering worst as oil and natural gas make new multi-year lows.
- Among the movers: Comerica (CMA -2.9%), Zions (ZION -3.3%), Prosperity (PB -3.3%), Cullen/Frost (CFR -2.6%), MidSouth Bancorp (MSL -1.4%), BOK Financial (BOKF -3.2%), Hancock Holding (HBHC -3.8%), Green Bancorp (GNBC -0.1%), Iberiabank (IBKC -3%), National Bank Holdings (NBHC -0.5%), Texas Capital (TCBI -4.6%), Independent Bank Group (IBTX -2.6%), Interstate BancSystem (FIBK -1.1%), First Financial Bankshares (FFIN -3.5%).
- Screening the whole group against the KRE finds only Interstate BancSystem as outperforming over the past month.
Jul. 17, 2015, 11:05 AM
- Q2 net income of $135M or $0.73 per share vs. $151M and $0.80 one year ago.
- Net interest income of $421M vs. $416M a year ago, with NIM of 2.65% down 13 basis points.
- Noninterest income of $261M vs. $220M. Noninterest expense of $436M vs. $404M.
- Average loans of $2.1B up 5% Y/Y. Average deposits of $408M up 1% from Q1.
- CET 1 ratio of 10.53% up 13 basis points.
- Net charge-offs of $18M or 0.15% of average loans vs. $8M and 0.07% in Q1. Management notes net charge-offs continue to be well below normal readings, and the increase is from unusually low levels. Provision for credit losses up $47M, mostly as a result of energy exposure. Reserve to total loans ratio rises to 1.24%.
- Previously: Comerica misses by $0.02, beats on revenue (July 17)
- CMA -5.3%
Jan. 13, 2015, 9:47 AM
- Dallas-based Comerica (CMA +1.9%) has been punished of late thanks to its exposure to the struggling energy sector, as well as its "asset sensitivity" - i.e., the idea earnings could be constrained by low interest rates more than some peers.
- The stock is lower by nearly 20% since mid-September, and Baird has seen enough and upgrades from Underperform to Neutral.
Dec. 8, 2014, 1:17 PM
- Dallas-based Comerica (CMA -1.3%) is an outlier to the downside among the regional names as oil tumbles another 3.7% to the lowest level since the summer of 2009.
- Other lenders with sizable Texas-operations and exposure to energy credit: MidSouth Bancorp (MSL +0.9%), BOK Financial (BOKF -0.6%), Cullen/Frost (CFR -1.5%), Hancock Holding (HBHC -0.9%), Green Bancorp (GNBC -0.7%), ViewPoint Financial (VPFG -0.5%), Iberiabank (IBKC +0.1%), National Bank Holdings (NBHC +0.1%), Texas Capital (TCBI -1.3%), Prosperity Bancshares (PB -0.8%), Independent Bank Group (IBTX -1%), Hilltop Holdings (HTH -0.7%), First Interstate BancSystem (FIBK +0.4%), First Financial Bankshares (FFIN -0.8%)
Oct. 20, 2014, 9:48 AM
- Nomura and Bernstein ring the register on their Sell/Underperform calls, upgrading Comerica (CMA +1.8%) to Neutral/Market Perform, and Sandler O'Neill upgrades to a Buy.
- The stock slid on Friday after earnings fell short of expectations, and one issue on the conference call (transcript) was the bank's large exposure to Texas and thus recently slumping energy prices.
- "We are not concerned at this time," says Chief Credit Officer John Killian. "We’ve been in this business for 30 years so we have seen lots of ups and downs." He notes the energy portfolio accounts for about 7% of loans outstanding. "Most of our customers are well hedged on average 50% are hedged for two full years and many are for longer periods."
Oct. 17, 2014, 9:57 AM
- EPS of $0.82 vs. $0.78 in Q2. 3Q14 EPS reflects net benefit of $15M or $0.03/share after tax on certain items.
- Recent dividend of $0.20
- Net interest spread of 254 bps down from 265 bps in Q2.
- Average total loans up 7% y/y to $47.2B
- Tier I common capital ratio of 10.69% vs. 10.5% in 2Q
- Repurchased approx. 1.2M shares during 3Q14
- Conference call. Webcast here.
- CMA -2.1%
- Previously: Comerica misses by $0.01, misses on revenue
Feb. 14, 2014, 10:13 AM
- The easy leader in the regional banking sector today is Comerica (CMA +2.1%) after an upgrade to Buy at Ciitgroup.
- The bank two weeks ago boosted its quarterly dividend by 11.7% to $0.19 per share. Between dividends and share repurchases, the bank returned 73% of 2013 net income to its owners. The dividend hike comes at it awaits word from the Fed (expected in March) on its 2014-15 capital plan.
Jan. 8, 2014, 9:54 AM
- Oppenheimer is moving some smaller bank names around this morning, upgrading TCF Financial (TCB +2.3%) to Outperform, and removing its Underperform rating on Comerica (CMA +0.5%).
- At the same time, the team removes its Outperform rating First Midwest Bancorp (FMBI -1.6%) and KeyCorp (KEY -0.3%), cutting both to Perform.
Nov. 8, 2013, 10:41 AM
- Up sharply as interest rates fly higher (the 10-year is up 15 basis points to 2.75%) are the life insurers - all of whom have had their investment returns more than a little constrained by puny yields. IAK +2.4%
- MetLife (MET +5.9%), Prudential (PRU +4.5%), Lincoln National (LNC +6.8%), Hartford (HIG +3.1%).
- Also set to benefit from a steeper yield curve (if we're to believe their models) are the banks, and they're leading the S&P 500 higher. The TBTFs: Bank of America (BAC +3.3%), JPMorgan (JPM +3.1%), CItigroup (C +3.3%), Wells Fargo (WFC +2.6%). The regionals (KRE +3.4%): Huntington (HBAN +2.6%), Regions (RF +4.2%), PNC (PNC +2.8%), FIfth Third (FITB +3.4%), First Niagara (FNFG +2%), Keycorp (KEY +3.5%), Zions (ZION +4.1%), Comerica (CMA +3.1%).
- The XLF +1.9%.
- FInancial sector ETFs: FAS, XLF, FAZ, UYG, KRE, KBE, VFH, IYF, KIE, SEF, IAT, IAI, IYG, IAK, FXO, PFI, KBWB, RKH, QABA, RWW, FINU, RYF, KRU, KBWR, PSCF, KBWP, KBWI, KRS, FINZ, FNCL
Aug. 14, 2013, 3:59 PM
- Biolase (BIOL -33%) gets hammered on solvency concerns after saying that it's reducing its registration statement from $30M to $5M due to an unwarranted amount of confusion in the marketplace since filing its S-3 on July 26.
- The announcement comes just after Comerica Bank (CMA) agrees to waive its requirement that BIOL earn at least $500K EBITDA.
- BIOL reported a net loss of $2.6M (EBITDA) for Q2 2013.
- Under the terms of the waiver, the two companies agreed on a further amendment to the loan agreement containing revised financial covenants by September 13.
- They also agree that until Sept 13, BIOL cannot extend its loan facility by more than $7.5M.
Jul. 5, 2013, 12:51 PM
Regional banks (KRE +2%) are the day's strongest performers - sailing through today's big rise in interest rates the way they cruised through June's increase. Interest rate margins are on the rise, economic growth should help sluggish loan volume, and the idea new bank capital rules will go easier on them than the TBTFs all factor in. Huntington (HBAN +2.9%), Regions (RF +1.8%), BB&T (BBT +1.9%), PNC (PNC +2.2%), Hudson City (HCBK +1.5%), Fifth Third (FITB +1.6%), SunTrust (STI +3.5%), KeyCorp (KEY +3%), Zions (ZION +3.5%), Comerica (CMA +2.7%), Popular (BPOP +1.2%).| Jul. 5, 2013, 12:51 PM
Jun. 20, 2013, 12:36 PMMostly in the green along with the life insurers today is much of the regional banking sector (KRE +0.5%) as a steeper yield curve is sure to boost their barely visible net interest margins. U.S. Bancorp (USB +0.1%), Huntington (HBAN +2.2%), New York Community (NYCB -0.1%), Regions (RF +0.7%), BB&T (BBT +1.2%), PNC (PNC +0.7%), SunTrust (STI +0.7%), KeyCorp (KEY +1.5%), People's Untied (PBCT +1.3%), Zions (ZION +1.9%), Comerica (CMA +1%). | Jun. 20, 2013, 12:36 PM
Dec. 7, 2012, 4:03 PM
Shares of CombiMatrix Corporation (CBMX) soar today, finishing up over 334% after the New England Journal of Medicine published two studies concluding chromonosomal microarray analysis (CMA) is superior to standard karyotyping for identifying prenatal genetic abnormalities. CBMX currently is the only publicly traded firm offering CMA diagnostics. One caveat, despite today's big run - the shares still are down over 55% from its $20 peak at the beginning of the year.| Dec. 7, 2012, 4:03 PM