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J.P. Morgan Maintains New York Community Bancorp Neutral Rating, $19 PT (NYB)

J.P. Morgan maintained its New York Community Bancorp (NYSE: NYB) Neutral rating and $19 price target in a research report published today.

In the report, J.P. Morgan states, "Although NYB reported core EPS of $0.32, which exceeded our $0.30 estimate, our EPS estimates are left relatively unchanged as the beat was tied in large part to higher than expected prepayment fees. With spread revenues representing 80% of total revenues and the loan growth picture improving but unlikely to show substantial growth in 2011 given refi activity among NYB's multi-family customers, the key to further profit improvements in our view will be contingent on NIM expansion in the new year. With that said, however, with the NIM heading into 2011 including $15 million in prepayment penalty fees that may fade through the year as well as the bank adding new loans to its portfolio at a rate lower than the average loan yield, we believe it will be akin to swimming upstream for the bank to see meaningful NIM expansion through 2011. Although good expense control combined with overall balance sheet growth should work to offset potential NIM pressure, overall we don't see much room for meaningful improvement in ROE in 2011."

Shares of New York Community Bancorp were at $18.14 at the time of posting in after-hours trading, down 0.07% from Wednesday's market close.

Posted-In: J.P. MorganAnalyst Color Analyst Ratings

 

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