Wunderlich Reiterates On Comerica Following Q4 Earnings

Wunderlich reiterated its Buy rating and $65 price target on Comerica Incorporated (NYSE: CMA) Friday after the company reported Q4 earnings.

“With the decline in the price of oil, CMA shares have come under pressure recently, which is understandable. However, just 7 percent of loans are energy related, and just 24 percent of total loans are in Texas, which should ease the challenges of low oil somewhat,” according to analyst Kevin Reynolds.

Reynolds added that “CMA has one of the most favorable core deposit bases in the U.S. and remains primarily a floating rate lender, implying significant upside should the FOMC ever raise short-term rates. Until then, CMA is well positioned to experience solid organic growth within and outside of Texas, while returning significant amounts of excess capital to shareholders in the form of increased dividends and ongoing buybacks.”

The firm lowered its “2015 EPS estimate by $0.10 to $3.30. We are also establishing a 2016 EPS estimate of $3.65 (+11 percent vs. 2015E) at this time. CMA shares are currently trading at about 12x our 2015 EPS estimate, which is essentially in line with Regional Bank peers...and 1.1x TBV/share (modest discount to peers).”

Comerica recently traded at $41.38, up 1 percent.