UPDATE: Keefe Bruyette & Woods Upgrades Sierra Bancorp to Outperform; Sell-Off Not Warrated

Keefe Bruyette & Woods raises its rating on Sierra Bancorp

from Market Perform to Outperform and keeps its $12 price target unchanged. Keefe Bruyette & Woods comments, "Shares of BSRR trade below peers despite PTPP profitability outperformance by the company. We believe the company's elevated credit costs account for the lower bottom-line profitability metrics, and ROE is further hampered by Sierra's higher capital cushion. While we admit that we remain cautious on future credit costs at the company given its current NPA level (8.55% of loans and OREO at 3/31/2012), we do not believe the discount to book and to peers is warranted given the company's core income generation capabilities. We also note that Sierra pays a cash dividend, while the majority of its peers do not." BSRR closed at $8.59 on Wednesday.