Analyst: Pinnacle a buy if you can stomach the risk
Posted on July 28, 2009 at 12:40 pm
Mark Muth at Howe Barnes says investors with a longer time horizon can now jump into Pinnacle Financial, which is wrestling with a deteriorating commercial loan portfolio.
Ultimately, we believe multi-year holders of the stock will look back on current levels as a favorable entry point once the credit issues have dissipated; however, given the significant near-term uncertainty regarding the credit outlook, we would remain on the sidelines for now and await improved credit/earnings power visibility.
permalink | Comment on this post
GreenBank parent spikes dividend, gets upgraded
Posted on June 2, 2009 at 11:33 pmThough not in that order: Howe Barnes analyst Jeff Davis upgraded the shares of Green Bankshares (Ticker: GRNB) to ‘neutral’ Tuesday morning after the stock’s recent pullback. But he noted that he expects the shares “to be under pressure for the balance of the year given the level of NPAs and losses that we are projecting.” Because of that, he added, the company would likely slash or spike its dividend to save capital.
A few hours later, the company said its dividend is toast for now.
“It is extremely important to maintain our strong capital levels and, after careful deliberation, the Board of Directors and management have concluded that the decision to suspend the cash dividend on our common stock is the prudent course of action.”
permalink | Comment on this post
Pinnacle upgraded on price drop
Posted on June 1, 2009 at 6:50 amAnalyst Jeff Davis at Howe Barnes has raised his rating on the shares of Pinnacle Financial (Ticker: PNFP) to ‘neutral’ after their slide from $25 to $14 in two months. Davis expects the bank to raise anywhere between $75 million and $125 million before the end of the year, which likely won’t help the stock in the coming weeks.
Near-term, the pending common raise will act as a governor on the shares unless 2Q09 results materially surprise to the upside in conjunction with a drop in NPAs; that seems unlikely.
permalink | Comment on this post
TNCC upgraded, but credit quality still key
Posted on May 20, 2009 at 8:24 amHowe Barnes analyst Jeff Davis says shares of the Franklin-based business bank (Ticker: TNCC) are cheap enough for him to upgrade them from ’sell’ to ‘neutral.’ But, he adds, the stock won’t move much until the company manages to hike loan loss reserves and stabilize problem loans.
Loan growth has to slow to match internal capital generation if not fall below it to build the parent’s tangible common ratio (5.3%) even though regulatory capital at the Bank-level exceeds the “well capitalized” threshold.
permalink | Comment on this post
Local analyst: Banks’ book values have more to fall
Posted on April 16, 2009 at 1:21 pmNashville-based bank analyst Jeff Davis has begun covering most of the Southeast’s regional players with ‘hold’ ratings. His earnings estimates are generally below the investment community’s consensus numbers because he sees “migrating” credit issues. Those problems will eat at banks’ capital positions and push down book values until the end of 2010.
“Over the next few quarters, the industry should get closer to reality in that reserves will be much higher, more loans will have been written off and presumably the economy will be closer to basing, thereby creating a better risk-reward scenario for depository investors,” Davis wrote.
The government also will be in the banks’ corner to a certain extent, Davis said, though not necessarily on purpose. “Public policy for the large banks is such that these institutions are nearly too-big-to-fail… As a result, the government is unlikely to force draconian mark-to-distressed loan bids that create an immediate capital call if for no other reason than the government cannot seem to get organized to close small banks.”
permalink | Comment on this post
Analyst action: CHS, Tennessee Commerce
Posted on April 8, 2009 at 10:02 am
Goldman Sachs has kicked Community Health Systems off its Conviction Buy List. Shares of the Franklin-based company (Ticker: CYH) are down about 6 percent today and close to break-even for the year.
Over at Howe Barnes, analyst Jeff Davis has slashed his rating on Tennessee Commerce to ’sell’ after the bank said it will write down the value of its owned real estate by almost $3 million and further beef up loan loss reserves. Davis, who is based in Nashville, said CEO Art Helf and his team will have to slow loan growth to maintain their capital ratios. He expects Tennessee Commerce shares (Ticker: TNCC) will struggle in the coming months.
Our investment thesis assumed for the shares to rise from a pedestrian valuation that TNCC would have to prove to investors that it could manage through the deep recession and remain profitable… With this quarter’s loss, the shares will likely remain in the penalty box until the economy strengthens and/or the company strings together several quarters of profitability.
Almost 90 minutes into today’s session, Tennessee Commerce’s very thinly traded stock has yet to change hands.
Recent Comments
In our good state a select few run the place, 20 yrs ago and today....
Southernindie…Unfortunat ely you have suffered a dibilitating...
And…Karl (Marx) Dean is spending one billion dollars...
Someone explain the difference between short stay and observation...
Watching the Chairman of Starwood Hotels yesterday on CNBC...
Funny how the Union’s feel about taxes. They complained about their...
Where is it?
An absolutely ugly structure, which I have always thought did not take...
Too bad that ATT changed the look of the building so that it no longer...
Yeah, well, look at the TN Legislature of good ol’ boys and the...
As long as the red rules, we will be far behind other states. The GOP does...
Nissan CEO Carlos Ghosn: I don’t know what...