UPDATE: JP Morgan Upgrades SunTrust Banks to Overweight on Housing Recovery Exposure

JP Morgan raised its rating on SunTrust Banks

from Neutral to Overweight and increased its price target from $29 to $31.50. JP Morgan noted, "As the housing market gradually recovers, SunTrust should benefit from the decline in residential mortgage related net charge-offs (NCOs), and other credit related expenses (such as collections costs), and to some extent, OREO expense and mortgage putback expense. … Benefits from the housing market recovery plus continued cost cutting beyond the restructuring program announced should benefit SunTrust's earnings outlook. Valuation is attractive at 1.0x tangible book, which is below peers. 2013 does not represent normalized earnings and the large drag from housing related costs should be a greater benefit to earnings than peers beyond 2013." SunTrust Banks closed at $25.45 on Tuesday.