Citi puts JPMorgan on positive catalyst, upgrades BNY Mellon, cuts M&T

Oct. 04, 2022 8:49 AM ETM&T Bank Corporation (MTB), BK, JPMWFC, USB, CMA, RF, NTRS, TFCBy: Liz Kiesche, SA News Editor2 Comments

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JPMorgan Chase (NYSE:JPM) stock has gained 1.8% in Tuesday premarket trading after Citibank analyst Keith Horowitz started a positive catalyst watch on the stock. The action is part of the analyst's refresh of earnings models ahead of Q3 earnings season (set to kick off late next week).

He sees JPM as poised for a Q3 top line beat, which would lead to upward revisions on full-year guidance and sets up a better run-rate in 2023.

Bank of New York Mellon (NYSE:BK) gets upgraded to Buy from Neutral due to limited credit risk, strong return outlook, and capital return capacity. Stock has jumped 3.1% premarket.

And while M&T Bank (NYSE:MTB) has been a top performer year-to-date, Horowitz downgraded the stock to Neutral from Buy as much of its upside seems to be priced in. He also removed it from the firm's U.S. focus list. The stock is up 0.5% in premarket.

Heading into Q3 earnings, he initiated three pair trades — Overweight Wells Fargo (WFC)/Underweight Truist Financial (TFC) as he sees TFC at higher risk of negative EPS revisions; Overweight Comerica (CMA)/Underweight Regions Financial (RF) due to wide discrepancy in implied cost of equity capital (CoE) between the two; Overweight BNY Mellon (BK)/Underweight Northern Trust (NTRS) on greater risk of negative EPS revisions at NTRS.

The analyst closed its Overweight WFC/Underweight U.S. Bancorp (USB) pair trade as thesis on rapidly rising rates benefiting Wells Fargo (WFC) more than USB has largely played out.

Compare key stats of up to six tickers in the peers tab. Quant rating has Strong Buy ratings on Wells Fargo (WFC), Truist (TFC) and Comerica (CMA).

SA contributor Six-Five Research rates JPMorgan (JPM) a Buy for long-term focused dividend investors. Gen Alpha calls BNY Mellon (BK) a great dividend grower that's very cheap

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