Sterne Agee Has Buy on Prudential
Sterne Agee is out with a research report on Prudential (NYSE: PRU) and it has a Buy rating and a $81 price target on shares.
In a note to clients, Sterne Agee writes, "We view PRU's core operating EPS YTD in 2011 as $5.07, well above the $4.48 on a reported basis. Layering in our current 4Q11 core EPS estimate of $1.78, we get full year 2011 core EPS of $6.85. Assuming the $0.30-$0.40 YTD drag ($150-$200m after-tax) from implementing the accounting change annualized for full year impact of $0.40-$0.53 ($200-$265m after-tax), we get a starting point of 2011 Core EPS of $6.32 - $6.45. We'll use the midpoint for baseline into 2012, or $6.38. Making the same adjustments for the DAC earnings drag against our current 2012E EPS of $7.46, we arrive at a range of $6.93 - $7.06, with a midpoint of $7.00."
Shares of PRU gained $2.15 yesterday to close at $53.67, a gain of 4.17%.
